Doral pours $738M into US arm at $4.1B valuation, may delay IPO
What's the deal? Doral EnergyDealroom has a profile for this one. Try Dealroom → will invest $738 million (NIS 2.2 billion) in its US subsidiary, Doral LLC, more than doubling its stake to 53.2% from 26%. The Israeli renewable energy company's move values the American arm at about $4.1 billion.
How it's structured: The transaction has three parts. The largest is a $400 million capital injection for an extra 9.7% of the subsidiary; the rest comes from buying shares held by Doral LLC chief executive officer Nick Cohen and completing a $132 million deal agreed in November.
Why now? Doral prepared by raising NIS 920 million ($307 million) from institutional investors in June. "This is a strategic deal for Doral that gives it stronger access to its main growth engine," chief executive officer Yoni Hantis said.
What's the endgame? Doral LLC has built a pipeline of 7.9 gigawatts of renewable projects and 2.5 gigawatt-hours of storage, most already eligible for US tax benefits. The capital will help connect most projects to the grid by 2029, adding roughly NIS 620 million ($207 million) a year to Doral's share of EBITDA.
What could go wrong? The move may postpone a separate IPO of Doral LLC, which Doral was promoting late last year at a valuation of around $2 billion to raise $400 million to $500 million.
The signal: The $738 million round ranks in the 95th percentile among all-time growth equity deals in US energy, underscoring investor appetite for US renewable assets. Analyst Gilad Ben Zvi of Leader Capital MarketsDealroom has a profile for this one. Try Dealroom → called the deal positive, noting its EV-to-EBITDA multiple of 7 to 8 compares with more than 15 for peers — "a very attractive multiple for Doral."
Read more: Calcalist
Image credit: Doral Renewables
