Ormat Technologies To Buy Parent Through Share Exchange

(RTTNews) - Geothermal company Ormat Technologies Inc (ORA) said Monday it is entering into a definitive share exchange and plan of merger agreement (the "Exchange Agreement") with its parent entity, Ormat Industries Ltd ("OIL").

Under this agreement, Ormat Technologies will acquire Ormat Industries through a share exchange that will eliminate OIL's majority ownership interest in, and control of, Ormat Technologies. OIL currently holds about 60% of Ormat Technologies' outstanding common stock.

Isaac Angel, Ormat Chief Executive Officer, stated: "Streamlining our corporate structure is a crucial step to unlocking the value inherent in our business. Ormat transitioning to a non-controlled single public listing will significantly increase the number of shares available to be publicly traded. We believe that enhancing liquidity and increasing shareholder base will translate to increasing shareholders value."

Under the terms of the Share Exchange Agreement, OIL shareholders will be entitled to receive 0.2592x shares for each share in OIL, or an aggregate of about 30.3 million shares.

Upon closing of the transaction, existing Ormat Technologies shareholders will own nearly 38% and former OIL shareholders will own about 62% of Ormat Technologies.

The transaction is expected to close in the first quarter of 2015.

Ormat Technologies' board approved the Share Exchange Agreement and the transactions contemplated thereby and recommended that it be approved by Ormat Technologies shareholders.

OIL has executed a written consent approving the transaction and, consequently, no other vote of Ormat Technologies shareholders will be necessary or solicited.

Ormat Technologies anticipates that the transaction will benefit Ormat Technologies and its stockholders in several ways, including enhanced liquidity, snergies, and become a non controlled public company.