Elco Group Prepares to Sell Controlling Stake in Energy Firm Supergas
Elco Group has initiated a process to sell its 61% controlling stake in energy firm Supergas Power, selecting Phoenix Underwriting as its investment banker. The move aims to reduce financial leverage as Supergas reports growing revenues and improved quarterly profitability.
Elco Group is preparing to sell its controlling stake in Supergas Power, one of Israel's long-standing energy companies, according to market sources. Elco, which holds a 61% stake in the firm, has selected Phoenix Underwriting to serve as the investment banker guiding the process and managing an organized sale procedure with potential buyers. This move is part of Elco's broader strategy to reduce financial leverage and strengthen its balance sheet through asset monetization.
Supergas currently has a market capitalization of approximately NIS 450 million, though it is widely expected that Elco will not agree to sell control at a company valuation lower than its equity, which stands between NIS 700 million and NIS 750 million. Supergas, managed by Daniel Sapir, operates in two main sectors: the distribution and supply of liquefied petroleum gas (LPG) to private and commercial clients, and electricity supply as part of the ongoing opening of the domestic electricity market to competition.
According to the company's financial presentation for the second quarter of 2026, revenues in the first half of the year totaled approximately NIS 493 million, compared to NIS 391 million in the same period last year. EBITDA for the half-year stood at roughly NIS 36.5 million, remaining stable compared to the corresponding period. In the second quarter alone, Supergas recorded revenues of about NIS 229 million, representing a 31% growth, while EBITDA surged by 66% to approximately NIS 14.7 million. Gross profit for the quarter reached NIS 37.5 million, a 33% increase.
The LPG segment remains the company's primary profit driver. Segment revenues in the first half reached approximately NIS 265 million, a 12% increase, with a sectoral EBITDA of around NIS 41 million. Meanwhile, the electricity supply activity recorded a 47% growth in half-year revenues to about NIS 228 million, though it still posted a negative EBITDA of approximately NIS 1 million. In recent months, Supergas executed a significant asset disposal by selling its natural gas and cogeneration operations for about NIS 406 million. The transaction is projected to reduce net financial debt by approximately NIS 292 million, bringing it down from roughly NIS 602 million at the end of June to about NIS 310 million post-transaction.
