First merger in the electricity supply market: Super Power acquires Paz Gas Energy

Super Power is acquiring Paz Gas Energy for up to NIS 25 million, in the first merger deal in the private electricity supply market. The acquisition is expected to increase Super Power's revenues by NIS 130 million per year and reduces the number of competitors from seven to six. The low price reflects the lack of profitability in the industry.

The household electricity supplier Super Power is acquiring competitor Paz Gas Energy for up to NIS 25 million, in a deal expected to increase its revenues by NIS 130 million per year. The acquisition reduces the number of competitors in the private electricity supply market from seven to six. Super Power, controlled by Supergas Power (Electra) and Enlight, will pay NIS 15 million in the first stage and up to an additional NIS 10 million depending on a customer transfer mechanism. The relatively low price compared to the additional revenues reflects the fact that the sector is still loss-making or has very low profitability. The market is now divided into three large players (Bezeq Energy, Cellcom Energy, Super Power) and three small ones (Amisragas Energy, Hot Energy, Partner Power). Lior Vider from "Mechpile Revach" said the acquisition constitutes "a clear establishment of Super-Power as one of the aggressive and leading players in the market" and that the merger trend is expected to continue.