Adi Zaltzman, Gal Giladi, and Tal Wijnbergen represented “Delek” – The Israeli Fuel Company Ltd. – in the completion of an agreement with Leumi Partners Ltd., under which Leumi invested NIS 213 million in Delek, reflecting a pre-money valuation of approximately NIS 850 million for Delek, in exchange for an allocation of 20% of Delek’s shares.
The investment agreement includes provisions regarding representations and indemnities, Ratchet mechanisms, a commitment to complete an IPO within 4 years, adjustments in the event of an IPO at a lower valuation, and Leumi’s right to sell its Delek shares if an IPO does not occur within 4 years.
Leumi and the existing shareholders of Delek entered into an agreement to regulate their relations as shareholders in Delek, which included the following mechanisms (most of which will be canceled upon an IPO): provisions and restrictions on the transfer of Delek shares, the composition of Delek’s board of directors, and the manner of decision-making in Delek’s corporate bodies. Additionally, a mechanism was included for the event that Delek is considered a “significant real corporation” under the Concentration Law, according to which Leumi will be entitled to sell its shares in Delek to the existing shareholders and/or to the company.
Leumi’s entry as a shareholder in Delek is a significant move for Delek’s continued development and growth. The transaction is being carried out in parallel with Delek’s engagement, together with Leumi and Keystone, in an agreement to acquire Hot Mobile, with the investment amount to be used by Delek to finance its part in this acquisition.
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