MIRA
INFORM REPORT
|
Report Date : |
2nd March, 2007 |
IDENTIFICATION
DETAILS
|
Name : |
PAZ ASHDOD REFINERY LTD. |
|
|
|
|
Registered Office : |
P.O. Box 338 , Northern Industrial Zone, Ashdod 77102 Israel |
|
|
|
|
Country : |
Israel |
|
|
|
|
Financials (as on): |
30.09.2006 |
|
|
|
|
Date of Incorporation : |
04.01.2006 |
|
|
|
|
Com. Reg. No.: |
51-377516-3 |
|
|
|
|
Legal Form : |
Private Limited Company |
|
|
|
|
Line of Business : |
Oil refiners - dealing in
refining, production and marketing of crude oil and its products. |
RATING &
COMMENTS
|
MIRA’s Rating : |
Aaa |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest capability
for timely payment of interest and principal sums |
Unlimited |
|
Status : |
Good |
|
|
|
|
Payment Behaviour : |
Regular |
|
|
|
|
Litigation : |
Clear |
Company Name & Address
PAZ ASHDOD REFINERY LTD.
Telephone 972 8 851 28 88
Fax 972 8 852 26 84; 856 52 67
P.O. Box 338
Northern Industrial Zone
ASHDOD 77102 ISRAEL
HISTORY
A private limited company, incorporated as
per file No. 51-377516-3 on the 4.1.2006.
Actual operations started in mid 2006, after
parent company, PAZ OIL COMPANY LTD. won the State tender for the Ashdod
Refineries.
Originally established
under the name of ASHDOD - OIL REFINERY LTD., which changed to the present name
on the 17.1.2007.
The acquired activities were
from State-owned OIL REFINERIES LTD., originally established as a private
limited company, registered as such as per file No. 51-021347-3 on the
11.8.1959.
This company was
established in order to continue the activities of UNITED REFINERIES LTD., which
was established in 1938 by the British Authorities, following the acquisition
of the activities by the State of Israel.
Converted into a public
limited liability company and registered as such as per file No. 52-003665-8 on
the 4.12.1990.
OIL REFINERIES LTD. was
originally established under the name of HAIFA REFINERIES LTD., which changed
in 1972, following the erection of the oil refinery in Ashdod, completed in
1973.
As part of the State's privatization process, in which it is sold its
operations and assets, in August 2006, the PAZ OIL Group, controlled by Tzadik
Bino, acquired the Ashdod Refineries from the State in consideration of US$ 800
million, with intention to merge the refinery activities into PAZ OIL existing
extensive activities in the oil, fuel, gas and energy fields.
(During February
2007 the State also sold the Haifa Refinery, and OIL REFINERIES LTD. has been
left without activities).
SHARE CAPITAL
Authorized share
capital NIS 10,000,000.00, divided into – 9,999,999 ordinary "B" shares,
1 ordinary “A” share, all of NIS 1.00 each, of which shares amounting to NIS
16,580.00 were issued.
SHAREHOLDERS
Subject is fully
owned by PAZ OIL COMPANY LTD., controlled by Tzadik Bino (51%), the Lieberman
Family of Australia (20%), BANK LEUMI LE-ISRAEL LTD. (19%) and Modi Ben Sach
(7%).
Shares are held via POALIM NOMINEES SERVICES LTD.
On the 28.9.2006,
all issued shares were transferred to PAZ OIL from OIL REFINERIES LTD., as well as an
owner's loan of NIS 500 million from OIL REFINERIES LTD. to subject, in consideration of
NIS 3.251 billion.
DIRECTORS
1. Tzadik Bino, Chairman,
2. Modi Ben Sach.
GENRAL MANAGER
Ido Rozolio.
BUSINESS
Oil refiners - dealing in
refining, production and marketing of crude oil and its products.
Refinery capacity is around
4 million tons per annum.
Subject produces some one
third of the fuel in Israel.
Some 70% of sales are in
Israel, the rest is mainly to the Palestinian Authority.
95% of purchases are imports.
Amongst clients
are al local petrol, gas and fuel companies.
Operating from
owned oil refinery on an area of 1,081,000 sq. meters in Northern Industrial
Zone, Ashdod and from PAZ OIL headquarters in Southern Industrial Zone,
Netanya.
Having some 230
employees.
MEANS
In August 2006, subject was acquired for US$ 800 million.
The acquisition
included subject's oil stocks in value of US$ 315 million.
It also included
debts to banks of US$ 114 million.
Subject's book
value was valued US$ 360 million.
PAZ OIL COMPANY
LTD. current market value is US$ 961.2 million.
There are no
charges registered on the company’s assets.
Financial data is
included in the consolidated B/S of parent company, PAZ OIL COMPANY LTD., which
shows:
NIS (thousands)
30.09.2006
ASSETS
Current assets:
Cash and cash
equivalents 56,426
Negotiable securities 5,728
Customers 1,919,359
Other debtors 271,128
Deposits and advances to refineries 316,198
Stock 1,381,330
3,950,169
Loan for the
Fuel Administration 167,858
Investments,
loans and long term debits 377,825
Fixed assets,
net 3,791,710
Other assets
and deferred expenses __992,068
9,
279,630
========
LIABILITIES
Current
liabilities 7,410,832
Long term
liabilities 770,770
Liabilities for
losses of consolidated companies 1,959
Minority rights 5,819
Equity 1,090,250
9,279,630
========
ANNUAL SALES
Estimated 2005 profits of the Ashdod Refinery reported to be NIS 500
million.
The Ashdod Refinery first half of 2006 sales were NIS 2,600,000,000,
making a gross profit of NIS 332,000,000.
The following income figures of parent company PAZ OIL COMPANY LTD. do
not include subject's income (will be included in PAZ full 2006 annual
statements):
Consolidated 2005 income were NIS 7,189,387,000, making a net profit
of NIS 157,251,000.
Consolidated first 9 months of 2006 income were NIS 6,162,855,000,
making a net profit of NIS 85,399,000.
According to
reports, the acquisition of subject is expected to increase PAZ OIL
consolidated net profit by NIS 250 million per year.
OTHER COMPANIES
PAZ OIL COMPANY LTD., parent company, a holding company. It controls the
following companies, among others:
PAZOMAT OF THE PAZ
GROUP LTD.
NITUV FUELING
STATIONS LTD.,
METHODA
ENGINEERING, MAINTENANCE & LOGISTICS SERVICES LTD.
PAZMOVIL (FUEL TRANSPORT)
LTD., 51%, transporters and distributors of petroleum products.
YELLOW CONVENIENT
STORES CHAIN LTD., operators of convenience stores within gas stations.
PAZ LUBRICANTS AND
CHEMICALS LTD., manufacturers and marketers of lubricants (automotive and
industrial), chemicals, etc.
PAZGAS (1993)
LTD., 50%, suppliers of gas to 700,000 households, industrial and
institutions. Largest gas company in
Israel, with a market share of 31%.
PAZKAR LTD.,
manufacturers, marketers and exporters of sealing products, roofing felt,
adhesives, solvents, etc.
PAZ AVIATION
SERVICES LTD., suppliers of aviation fuel at all Israeli airports.
HAIFA BASIC OILS
LTD., 24.5%, manufacturers, producers, exporters and marketers of basic oils,
paraffin waxes, process oils, wax additives, etc.
PAZ INDUSTRIES
OILS AND LUBRUCANTS LTD.
NOGA PAZ POWER
RESOURCES LTD., 43.5%, project developers of IPP’s with particular emphasis on
environmental safety issues.
SAHAR DEVELOPMENT
& INVESTMENTS LTD.
PAZ AVIATION
ASSETS LTD.
BANKERS
The PAZ OIL Group
is known to all local banks.
CHARACTER AND REPUTATION
Nothing
unfavorable learned.
Subject officials
refused to disclose any details on the company.
The PAZ group is
Israel’s largest energy firm and supplier of refined petroleum products. It
operates a countrywide petrol and fuel station network, including 260 stations
(some 30% of the country’s total gas stations).
Tzadik Bino, who controls subject, is among the local leading businessmen.
Besides the PAZ OIL Group, Mr. Bino holds real estate properties in Israel and
abroad, as well as shares in RESHET, local TV Channel 2 concessionaires and 25
in a leading local advertising agency MECAN ARICKSON.
He also
controls the CANIEL Group, manufacturers and marketers of beverage cans (plastic
and tin), and 3 local banks: 48% in The First International BANK OF ISRAEL
LTD., Israel 5th largest bank, 100% in UBANK LTD. and 76% in BANK
OTZAR HACHAYAL LTD.
In October 2006,
the Commissioner for Trade Restrictions approved the acquisition of subject by
PAZ OIL COMPANY LTD., and authorized their merger (in legal context), however
under certain restrictions and conditions.
The deal
strengthens PAZ OIL position in the local energy market, in face of competition
from the DELEK GROUP, DOR ALON, SONOL and the newly privatized HAIFA OIL
REFINERY.
According to the
acquisition deal of the Ashdod Refinery, the Haifa Refinery will continue to
provide subject with administration services (including oil purchase,
marketing, etc.) and assistance in operating the refinery, for a period of up
to one year. PAZ has the right to ask to cease all the services in a month
notice.
In the beginning
of December 2006, PAZ OIL raised NIS 1.7 billion from the public through the
Tel Aviv Stock Exchange, by offering shares, options and bonds. PAZ OIL intends
to invest some NIS 900 million in subject and the refineries activities.
SUMMARY
Good for trade
engagements.
Maximum unsecured
credit recommended up to several US$ millions.
RATING
EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
|
56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
|
This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions