Electra Buys Golan Telecom for $91M
January 3, 2017 | Israel’s Electra Consumer Products, which makes air conditioners and electrical appliances and is a unit of Elco Holdings, has agreed to buy upstart mobile phone operator Golan Telecom for 350 million shekels ($91 million), ending months of speculation over Golan’s future. Electra also said it had signed a 10-year network sharing agreement with Cellcom, Israel’s largest mobile operator, and that Cellcom will lend it 130 million shekels to help finance the purchase of Golan. Electra shares jumped 10 percent on news of the deal, which will see it pay at least 210 million shekels a year plus value-added taxes for the network-sharing agreement. The final sum will depend on the number of Golan subscribers and their usage, Cellcom said in a separate statement. Golan was launched in 2012 after the Israeli government issued new licences to boost competition in a sector that had been dominated by three players. Golan has taken about 10 percent of Israel’s mobile market by offering rock-bottom prices, hurting Cellcom and main rivals Partner Communications and Pelephone, a unit of Bezeq Israel Telecom , which are now barely profitable. Cellcom tried to buy Golan in 2015 for about $300 million but was blocked by regulators.