Meitav Buys 11.5% of Shapir Infrastructure Partnership for 109 Million NIS
Meitav is acquiring an 11.5% stake in Shapir Engineering's infrastructure partnership for 109.25 million NIS. The deal brings total institutional ownership of the highway portfolio to 70%, valuing the partnership at 950 million NIS.
A major infrastructure transaction has been announced in Israel: Meitav Provident Funds and Pension is acquiring an 11.5% stake in the limited partnership of Shapir Engineering for approximately 109.25 million NIS. This is a significant move for Meitav, which is expanding its members' exposure to national infrastructure projects that generate long-term revenues.
The partnership includes rights in three major transportation projects: Highway 6 North, Highway 16 at the entrance to Jerusalem, and the Fast Lane on Highway 1 to Tel Aviv. For Meitav, this represents an investment in assets with a long operational horizon, as the concession periods for some of these projects extend for many years.
Institutional Expansion in Infrastructure
This transaction marks the third phase of Shapir's ongoing initiative to bring institutional investors into its projects as partners. In May, Migdal and Amital joined, jointly acquiring 38.5% of the rights for approximately 366 million NIS. In July, Clal entered the partnership, purchasing an additional 20% for about 190 million NIS. Following the completion of the transaction with Meitav, the cumulative holding of institutional bodies in the partnership will reach 70%, while Shapir will retain a 30% stake.
In total, institutional bodies have invested or are expected to invest approximately 665 million NIS to acquire these rights, reflecting a total valuation of about 950 million NIS for the partnership. Shapir will continue to serve as the general partner and will remain responsible for the ongoing management and operation of the partnership and the projects.
Project Portfolios and Concession Timelines
The move by Meitav carries special significance given the characteristics of the projects involved:
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Highway 6 North: Built with an investment of approximately 2.55 billion NIS, it began operations in 2019, and its concession is scheduled to end in 2049.
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Highway 16: Built with an investment of approximately 1 billion NIS, it began operations in 2022, and its concession is scheduled to end in 2044.
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Highway 1 Fast Lane: Built with an investment of approximately 760 million NIS, it has been operational since 2011, with its concession period scheduled to end in 2036.
Long-Term Yields and Capital Recycling
Meitav explains that the investment allows its members to benefit from exposure to an infrastructure portfolio that generates a stable cash flow over time. Nir Turner, Head of Infrastructure at Meitav, stated:
"The investment in this highway portfolio generates a stable, long-term cash yield for Meitav's members."
He added that the investment features include indexation to the Consumer Price Index, price adjustment mechanisms, and government safety nets.
For Shapir, bringing in institutional bodies allows the company to recycle a portion of the capital invested in projects that have reached a mature stage. The capital freed up by the transaction can be used by the company to promote new investments and growth in the infrastructure sector, while maintaining a 30% stake in existing projects and continuing to participate in future profits.
The transaction is not yet final. Its completion is subject to receiving a series of approvals, including from financing entities, project clients, the Competition Authority (if required), and the Tax Authority.
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