Ellomay Luzon Energy Increases Stake in Dorad Energy to 33.75% with Structured Debt Financing

Ellomay Capital's subsidiary, Ellomay Luzon Energy, has acquired an additional 15% of Dorad Energy's shares, increasing its holdings to 33.75%. The acquisition was financed through a structured debt of NIS 424 million (€108 million) and is not without controversy, as a legal dispute has arisen with Edelcom Ltd. over the acquisition. A court hearing is scheduled for August 2025.

Ellomay Capital Ltd. (NYSE American: ELLO) has further expanded its influence in Dorad Energy Ltd. (Dorad) through a strategic acquisition by its subsidiary, Ellomay Luzon Energy Infrastructures Ltd. (Ellomay Luzon Energy). On July 22, 2025, Ellomay Luzon Energy completed the purchase of an additional 15% of Dorad's shares, increasing its total holding to 33.75% [1].

The acquisition was funded through a structured debt arrangement of NIS 424 million (€108 million), consisting of three tranches. The first tranche, a NIS 175 million (€45 million) loan, has variable interest tied to the Israeli Prime Rate. The second tranche, another NIS 175 million (€45 million) loan, carries a fixed interest rate between 5% and 6%. The third tranche, a NIS 70 million (€18 million) loan, also has variable interest tied to the Israeli Prime Rate. This financing structure suggests Ellomay Capital's confidence in Dorad's dividend-generating capabilities [1].

The acquisition was executed under a right of first refusal granted to Ellomay Luzon Energy and other Dorad shareholders following the sale of shares by Zorlu Enerji Elektrik Üretim A.S (Zorlu). Edelcom Ltd. had initially agreed to purchase 7.5% of Dorad's shares but failed to meet the closing conditions, leading to the termination of their agreement. Ellomay Luzon Energy successfully fulfilled all conditions and acquired the 15% stake [1].

However, the acquisition is not without controversy. Edelcom Ltd. has filed a legal challenge, seeking to prevent the sale of 7.5% of Dorad's shares to any third party other than Edelcom. A court hearing is scheduled for August 6, 2025, to address this dispute [1].

Ellomay Capital's increased stake in Dorad Energy positions it to potentially influence strategic decisions and dividend distributions. The structured debt arrangement provides operational flexibility, with a dividend capture mechanism mandating early loan prepayment if annual dividends exceed NIS 65 million [1].

Ellomay Capital, founded in 2009, has a focus on renewable energy and power sectors in Europe, the USA, and Israel. The company's strategic acquisitions, including this latest move in Dorad Energy, reflect its commitment to expanding its renewable energy portfolio [1].

References:
[1] https://www.stocktitan.net/news/ELLO/ellomay-capital-announces-the-acquisition-of-15-of-dorad-energy-s-lo3txkalg146.html