February 1, 2018 / 11:29 AM / 4 months ago

UPDATE 1-Israel Electric to raise up to $1 bln in bonds from U.S. institutions

(Adds company restructuring detail)

JERUSALEM, Feb 1 (Reuters) - Israel Electric Corp plans to issue up to $1 billion in bonds to U.S. institutional investors, it said on Thursday, as the company presses ahead with a proposed restructuring.

The state-owned utility plans to hold investor roadshows in the United States and Europe in the coming week, it said in a statement to the stock exchange, adding that the offering will depend on market conditions.

The offering would be part of the company’s global medium-term debt issuance programme and the bonds will be tradeable on the Tel Aviv Stock Exchange.

In December, the government, Israel Electric and its workers reached a preliminary agreement to open Israel’s power generation sector to more competition after years of dispute.

The plan involves the sale of Israel Electric assets and job cuts, with implementation expected to cost up to 8 billion shekels ($2.3 billion) over eight years. The cost is less than the overall savings it expects from the restructuring, the company said.

Israel Electric, for decades a monopoly in all aspects of power generation and distribution, said it would sell off power plants that together produce 4,500 megawatts of electricity, about a third of its current installed capacity. ($1 = 3.4161 shekels) (Reporting by Ari Rabinovitch; Editing by Tova Cohen and David Goodman)

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