From the press and the media

Engel exits: sells part of Liberian iron mining franchise for $90 million

By Tali Zipori
Globes Business Arena

Jacob Engel, the Israeli businessman who made most of his fortune in the real-estate business records a significant exit from his operations in third-world countries.
Engel, according to an official report published by the buyer two days ago, sold the controlling share 51% of Elenilto Liberia Co. holder of an iron ore mining franchise in three of Liberia´s largest mines. Elenilto is a subsidiary of Engel´s private investment company, Engelinvest, that invests mainly in real-estate on the Russian market.

About 18 months ago, Engel won the franchise mentioned above (awarded for 25 years) and was initially supposed to pay $25 million to the Liberian government and an additional 3 million for every year of the franchise (totaling $75 million), as well as 21% of the mining profit from the franchise. As far as one knows, Elenilto did not remit the initial payment to the Liberian government and the buyer will have to pay it.

The company that bought Engel´s franchise is the Indian mining company, Vedanta, traded on the British stock exchange at a value of $6 billion.

Therefore, the sale of the controlling share of the franchise in return for $90 million – at a value of $176 million – produced a profit of tens of millions of dollars for Engel. The mines included in the franchise, according to Engel´s winning announcement made 18 months ago, contain at least 1.1 billion tons of iron ore.