Press Release

Ellomay Capital announces the sale of its Italian PV portfolio at an estimated profit of approximately €19 Million

Ellomay Capital Ltd., a renewable energy and power generator and developer of renewable energy and power projects in Europe and Israel, today reported the sale of ten Italian indirect wholly-owned subsidiaries, which own twelve photovoltaic plants with an aggregate nominal capacity of approximately 22.6 MW, and the sale of the receivables arising from shareholder loans provided to such companies
Emiliano Bellini

The agreed purchase price was €41 million for the cutoff date of December 31, 2018. The purchase price was adjusted in connection with funds received by the Company from the Italian subsidiaries during 2019 (approximately €2.3 million), resulting in a cash purchase price of approximately €38.7 million. The Sale and Purchase Agreement governing the sale of the Italian Subsidiaries and the Receivables includes customary representations and warranties and indemnification mechanisms, including specific indemnification for existing risks for a limited time in a non-material amount for the Company.

Based on the information currently available to the Company, the Company estimates that it will record a profit of approximately €19 million in connection with the sale of the Italian Subsidiaries and Receivables in its financial results for the fourth quarter of 2019. The profit currently expected to be recorded is an unaudited and unreviewed estimate and the actual results may be different from this estimation.

Ran Fridrich, CEO and a board member of Ellomay, commented: “The Company is pleased to announce the sale of the Company’s Italian PV portfolio at a very attractive price. The Italian PV portfolio was built during 2010-2013 and is based on a governmental feed-in-tariff. The acquisition of the portfolio was accomplished during the European financial crisis and was contrarian to market trends at the time. The Company, led by Mr. Hemi Raphael, Mr. Ran Fridrich and Mr. Shlomo Nehama took a pioneering approach by allocating substantial amount of the Company’s capital to PV projects in Italy. This enabled the Company to build a stable portfolio with a strong cash flow and high return. Approximately half of the portfolio was acquired in the ready to build stage and was constructed by EPC contractors under the Company’s supervision. The other half of the portfolio was acquired from German companies in receivership and required complex legal struggles that were managed by Mr. Hemi Raphael, an active director of the Company. The Company will use the proceeds of the sale for the redemption of its Series A Debentures and for investment in new PV projects that are expected to be built in Spain and Italy during 2020. The Company thanks Gianni, Origoni, Grippo, Cappelli & Partners, its Italian law firm for the transaction, and Armon Capital Advisory for introducing the purchaser and for advising during the process.”