Shikun & Binui Enters into an Additional Agreement for the Sale of its Shares of ADO Group

AIRPORT CITY, Israel, Feb. 3, 2019 /PRNewswire/ -- Shikun & Binui Ltd. (TASE: SKBN.TA) ("the Company"), a global construction and infrastructure company headquartered in Israel, today announced that following its press release issued on January 28, 2019 ("the previous report"), regarding the signing of an agreement and an option agreement for the sale of the shares of ADO Group Ltd.  ("ADO"), the Company is pleased to report as follows:                                            

1.      On February 1, 2019, the Company entered into an agreement for the sale of 2,751,200 ADO shares, constituting 10% of the issued share capital of ADO, at a price of NIS 88 per share of ADO ("the Additional Acquisition Agreement" and "the Additional Acquisition Transaction", respectively) to EPF Acquisition Co 86 S.a.r.l, a legal entity which to the best of the Company's knowledge, is managed by legal entities related to Apollo Global Management LLC ("EPF"). The Additional Agreement is the Additional Agreement as described in Section 2 of the previous report.

The completion of the additional acquisition transaction is subject to a number of preconditions, including the receipt of the approval of the Antitrust Authority in Germany and completion of the sale of an additional 20% of the shares of ADO by the Company ("Condition Dependent Shares") within 120 days of the signing date of the agreement. The Company may waive the fulfillment of the condition for the sale of an additional 20% of the shares of ADO, in whole or in part. It should be noted that the shares of ADO that will be sold by the Company, if indeed they are sold, as part of the acquisition transaction that is the subject of the previous report, constitute part of the Condition Dependent Shares.

The Additional Acquisition Agreement includes a number of related undertakings, including an undertaking by the Company not to sell shares of ADO for 30 days from the signing date of the Additional Acquisition Agreement, and to grant first refusal rights in favor of EPF upon the sale of the shares of ADO for a further period of 90 days; furthermore, there is a unilateral commitment by EPF to vote at the general meetings of ADO in favor of the appointment of one candidate to the board of directors of ADO, whose identity will be determined by the Company, commencing from the closing date of the transaction and as long as the Company holds 7.5% or more of  the shares of ADO.

2.      The signing of the Additional Acquisition Agreement also constitutes fulfillment of the precondition for the entry into force of the Option Agreement, as detailed in Sections 4 and 6 of the previous report.

3.      As stated in the previous report, if and to the extent that the Company completes transactions for the sale of 30% of the shares of ADO (and it is emphasized that there is no certainty), the Company will receive total consideration in the amount of NIS 720 million and record a pre-tax profit if NIS 480 million (based on the assumption of an average price of NIS 87 per share across the transactions). In the event that the Company partially waives the preconditions for the purchase transaction and the additional purchase transaction, such that the Company will sell only 20% of the shares of ADO, based on the same price assumption, the total consideration will amount to NIS 480 million and a pre-tax profit of NIS 320 million will be recorded.

It should be noted that in calculating the aforementioned consideration  and profit amounts, the proceeds from the exercise of the option, as subject to the option agreement, were not taken into account.

4.      Since the entry into force of the Additional Purchase Agreement is contingent upon various preconditions, there is no certainty that it will take effect and/or be completed and that any sale of ADO shares will be made by the Company.

About the Shikun & Binui Group

The Shikun & Binui Group is a global construction and infrastructure company that operates in Israel and internationally in seven segments: 1) infrastructure and construction contracting outside of Israel; 2) infrastructure and construction contracting within Israel; 3) real estate development within Israel; 4) real estate development outside of Israel; 5) renewable energy; and 6) concessions. The Group's activities focus on large, highly complex projects carried out for entities in private and public sectors with a focus on sustainability.

This summary announcement was prepared solely for the convenience of the reader and does not replace Shikun & Binui Ltd.'s (hereafter – "the Company") full report. The information contained in this announcement is, by its nature, incomplete. All of its contents are provided as a supplement to the Company's report, and are subject to the declarations therein stated. This announcement includes forecasts, assessments, estimates and other information relating to the Company or its subsidiaries, or to other parties or to future events and matters, the extent of whose realization is not certain and is not under the sole control of the Company (forward-looking information, as defined in the Securities Law-1968). The key facts and data serving as the basis for this information are facts and data, among others, related to the current status of the Company and its businesses, facts and data relating to the current status of the operating segments in which the Company engages in its areas of operation, and other macroeconomic facts and data known to the Company on the preparation date of this presentation.

It is understood that forward-looking information does not constitute a fact and is based solely on subjective assessments. Forward-looking information is uncertain and for the most part, is not under the Company's control. The realization or non-realization of the forward-looking information will be influenced, among others, by the risk factors that characterize the Company's operations, as well as developments in the general environment and external factors that impact the Company's operations. The Company's future results and achievements could differ significantly from those presented in this presentation. The Company is not obligated to update or modify the said forecast or assessment, and is not obligated to update this announcement. This announcement does not constitute an offer to purchase the Company's securities or an invitation to receive such offers. An investment in securities in general, and in the Company in particular, carries risk. One must take into account that past data do not necessarily indicate future performance.