ICL sole bidder for port; faces regulatory hurdles

Tel Aviv — Israel Chemicals Ltd. (ICL) is the sole bidder for the sale of Eilat port. The other three bidders who qualified – Gadot Containers, Papo Maritime, and Goldbond – dropped out at the last moment, informing the state-owned Corporations Authority that they would not be participating in the tender. The senior officials at the authority are due to convene next week to discuss the latest developments. Israeli financial sources attribute the decision by the three other potential bidders to drop out to a last minute change in the tender and the minimum price set by the authority. The ICL bid is also viewed as problematic and will need regulatory approval if accepted. Israel’s Anti-Trust Commission is likely to intervene and either set conditions for ICL ownership of the southern port or disqualify the company altogether. Labor party leader Shelly Yachimovitch has called for an immediate cancellation of the tender to privatize the port. She said that if ICL wins the tender she will take the matter to the Supreme Court. “At a time when the government presents a bill to reduce the concentration of the economy in the hands of just a few tycoons, it continues to privatize the country’s natural resources and infrastructure to the hands of one family—the Ofer family,” she said. The Ofer family owns 52 percent of ICL through its Israel Corp holding company. Yachimovitch said the government should implement the clause in the tender which allows it to disqualify a bidder on monopolistic grounds. The Labor party leader called for the government to rethink its policy on the privatization of Eilat port, which is Israel’s third largest port and has been handling an increasing share of the burgeoning trade with the Far East. ICL ships some 2.5 million tons of potash and other chemicals via the Eilat port, and the importance of the port has continued to grow in recent years as sales to the Far East increase. ICL accounts for nearly 20 percent of the port’s revenues, and shipments via Eilat are expected to continue to increase in the coming years. In addition, the government is planning a rail line to Eilat which would include a feeder line from Sdom at the Dead Sea specifically for shipping potash. Senior ICL officials have met with government officials handling the sale to clarify the company’s position. The company had demanded that cargo ships at its terminal in Eilat port be given priority over container vessels, but the government’s position is that this would reduce the attractiveness of the proposed privatization.