RAMAT HASHRON, Israel --- IMI Systems announced that the agreement to transfer the shares of IMI Systems to Elbit Systems was signed today (Sunday) in Jerusalem.
The signing ceremony was attended by the Accountant General of the Ministry of Finance, Rony Hizkiyahu, the Head of the Government Companies Authority (GCA) Yanki Koint, the Director General of the Ministry of Defense Udi Adam, the Head of the Israel Land Authority Adiel Shimron, the controlling shareholder of Elbit Systems Michael Federman and the President and CEO of Elbit Systems Bezhalel Machlis.
The decision to privatizing IMI was made by the government in 2013. At the end of a competitive process for selling the company, which was managed by the GCA in 2015, Elbit remained as the only proposer.
In June 2017, the Accountant General Rony Hizkiyahu was authorized by Committee for the Sale of State Shares to negotiate the terms of selling with Elbit. As part of the negotiations, the Accountant General reached an agreement with Elbit, which was approved by the committee, according to which the company will be sold for 1.8 billion NIS, of which 1.4 billion NIS will be paid on the closing date and the balance will be paid in two installments in 2020 and 2022, plus 100 million NIS results-dependent.
The consents anchor the evacuation of areas of Ramat Hasharon Tirat Hacarmel in a way that will enable to develop tens of thousands of residential units in the heart of the demand areas, as well as the establishment of plants in the Ramat Beka area in the Negev, which will promote employment and development in this area. Also, the consents protect the competition between the Israeli defense industries and the Ministry of Defense as a central customer of IMI Systems products.
Minister of Finance Moshe Kahlon said: “This is an important day for the defense industries in Israel. We have been talking about this important move for many years – and we are executing it. The privatization of IMI Systems will contribute to Israel’s economy in several ways: upgrading the defense industries and improving the competitiveness of defense exports, creating an independence company while ending its dependency on the State’s coffers, creating thousands of jobs in the Negev and the Galilee, evacuating lands in areas of demand for building for young couples. The fruitful cooperation of all parties brought us today to the moment of signing. The State of Israel and its citizens will all benefit from this move in the coming years.”
Accountant General Rony Hizkiyahu said: “The successful conclusion of the sale of IMI Systems has many advantages, mainly: protecting the interests of the Ministry of Defense, strengthening the healthy competition between the defense industries and contributing greatly to the future of IMI and its employees.” I want to thank the Director General of the Ministry of Defense, The Director of the Israel Land Authority and the employees of the Ministry of Finance and the Attorney General for the close cooperation that led to an excellent result for the Israeli economy and its security.”
Ministry of Defense Director-General Udi Adam said: “In the process of privatizing IMI, the Ministry of Defense has ensured the preservation of vital classified assets within the framework of a designated government company as well as the continued competition between the defense industries on a commercial basis that will enable to increase defense exports. IMI’s entry into Elbit will ensure the preservation of unique knowledge in Israel for the benefit of the IDF, the Israeli defense establishment and the Israeli economy.”
The budget director, Shaul Meridor, said: “We congratulate the completion of the long and complicated process of the privatization of IMI Systems and its selling to Elbit Systems. After many years in which IMI, as a government company, failed to realize its full capabilities and was supported by the state budget, IMI Systems is embarking on a new path as a private company.
We anticipate that selling the company will enable it to grow and maximize its abilities to prosper and evolve, thereby to bring the significant benefits to its employees and shareholders in particular, and to the Israeli economy in general, both economically and on the security level.”
Yanki Koint, Director General of the Government Companies Authority, said: “We are pleased to welcome the transaction, following the efforts of the Government Companies Authority and other government entities. Beyond the high value, the deal has many implications in various aspects of national security, both in the liberation of land for construction and in the development of the Negev, and in realizing the tremendous potential inherent in the knowledge and experience of IMI employees.”
The head of the Israel Land Authority, Adiel Shimron, said: “In the long-run, this important agreement will allow the construction of more than 30,000 residential units in the heart of the demand zone. This agreement joins a series of significant strategic agreements led by the Israel Land Authority in recent years, which designed to enable the evacuation of captured lands in the center of demand areas, for residential housing, employment and commercial areas.”