Israel's EZ Energy Updates U.S. Acquisition Agreements

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Israel's EZ Energy Updates U.S. Acquisition Agreements

ISRAEL -- EZ Energy Ltd., an Israeli holding company located here, updated it acquisition plans for convenience stores/gas stations in the U.S.

Previous reports by Globes Online stated that the company signed agreements to acquire 15 convenience stores on the U.S. East Coast for $15 million. Those locations have annual sales of $55 million.

New reports by state that EZ Energy's acquisitions will total 26 gas stations in the U.S., a deal that will generate $87 million USD per year. The company will pay $26 million for the locations, and an additional amount that will cover the cost of current inventory in the stores.

The company had also planned to acquire three groups of stations, totaling 60 locations, for $90 million. EZ Energy now plans to acquire 65 locations with accumulative annual sales of $230 million USD, new reports by stated.

In addition to the stations, EZ Energy will lease office space in the seller's headquarters.

"If this deal comes to fruition, within a few months EZ Energy will hold a portfolio of 106 gas stations and convenience stores, yielding $370 million USD," Oren Zahavi, EZ Energy's director, who was responsible for the deal's negotiations, told the Web site. "We intend to finance the deal with financial investors enabling EZ to expand its service station and convenience store portfolio with relatively low investments."

EZ Energy will finance the acquisitions with capital it gained from the Tel Aviv Stock Exchange. In addition, the directorate authorized contacts with underwriters to lead a private issue of bonds and options, reported.

EZ Energy's strategy is to locate convenience store/gas station clusters that ensure high yields, and at the same time try to introduce financial partners, the report stated. Using this strategy, the company plans to purchase a large number of gas stations through relatively small equity to complete acquisitions.

The acquisition is expected to be finalized March 12.