Stark Power raises $85 million from Israeli bank for major deal
The infrastructure company is in advanced negotiations to acquire an active power plant and a storage project in the USA. The assets are expected to generate an annual EBITDA of up to $33 million. At the same time, it is in talks to receive credit from an Israeli bank.
Stark Power (TASE: STRK), founded by former senior executives of Enlight and Nofar Energy, reports advanced negotiations for the acquisition of 100% of the rights to two energy projects near demand zones in the United States.
The deal includes an active natural gas power plant with a capacity of 250-300 megawatts, alongside a battery energy storage project in advanced stages of development with a capacity of 80 megawatts. For the deal, the company will pay approximately $27.5 million at the time of completion, and up to an additional $15.5 million as contingent consideration.
According to the company's estimates, the two projects together are expected to generate a representative annual EBITDA of $30-33 million, derived mainly from long-term 15-year Tolling agreements with entities having an A credit rating. This model ensures the company a stable cash flow without exposure to gas prices.
In parallel with the deal, Stark Power is conducting negotiations with an Israeli banking corporation to receive credit facilities and guarantees in the amount of $85 million to finance the deal and other future moves. The company's managers note that the area is characterized by high regulatory barriers and growing demand for electricity, partly due to the increase in the construction of data centers in the United States.
