Modiin Energy LP (TASE:MDIN.L), controlled by Nochi Dankner and Tzahi Sultan, and investment institutions want to buy shares in Cohen Development & Industrial Buildings Ltd. (TASE: CDEV), which owns 50% of Delek Group Ltd. (TASE: DLEKG) unit Avner Oil and Gas LP (TASE: AVNR.L).
Avner owns, among other offshore licenses, 23% of Yam Tethys, 15.625% of Tamar, and 22.67% of Leviathan. Modiin cannot buy shares in a private company, and will have to find an alternative solution.
Earlier this week, Cohen Development announced that its controlling shareholders want to sell their shares to a third party. These shareholders include Delek Group executive Gideon Tadmor (with a 6.3% stake); his mother, Hannah Tadmor (18.8%), his uncle David Cohen (19.2%), and another relative, Rona Arlitzki (6.7%).
The announcement raised little interest in the oil and gas exploration market, as the conventional wisdom among investors, analysts, and commentators was that the "third party" mentioned was Yitzhak Tshuva, who wanted the shares in order to increase his position in the gas reservoirs.
The conventional wisdom was wrong. Delek Group is not the third party, and is not in talks to acquire the shares. Moreover, the sale of the controlling interest in Cohen Development complicates Tshuva's plans for restructuring Delek Group's energy business. He is trying to delist Avner's direct parent company Delek Energy Systems Ltd. (TASE: DLEN) and to set up a new gas transportation company, reportedly to be called Delek Transportation, which will handle gas exports from Leviathan.
A capital market source said, "If another party acquires control of Cohen Development whose interests are not congruent with those of Delek Group this could benefit Avner's shareholders in the event of a conflict of interests between them and Delek Group, for example, a decision to transfer Avner's gas export business to Delek Group."
Published by Globes [online], Israel business news - www.globes-online.com - on November 10, 2011
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