Prime Energy: What It Really Bought In Lahav, Sunflower, And Solair, And How Much Of The Uplift Is Still Only On Paper

Where The Main Article Stopped, And What This Follow-Up Is Isolating

The main article argued that Prime's scale jump had already happened on the balance sheet, but still needed to be proven in cash. This follow-up isolates the core of that argument: what exactly entered the company through the Lahav merger and the Sunflower and Solair acquisitions, and how much of the uplift now presented to investors already sits in current yield versus how much still sits in an execution plan.

The short answer is that Prime did not buy three assets of the same quality. Lahav brought in a broader platform of connected systems, assets under construction, equity-accounted holdings, and a separate option in Germany. Sunflower and Solair, by contrast, were accounted for as asset acquisitions rather than business combinations, because the acquired activity largely consisted of electricity generation and simple maintenance, without employees and without a substantive development-and-construction layer. That is not the same quality of step-up.

The second gap is between what is already producing power and what is already being framed as almost-embedded enhancement. In its March 2026 presentation, the company already packages the acquired portfolios as 77 MW for development and enhancement, with about NIS 66 million of annual revenue addition. That is a legitimate business framing, but it already mixes the year-end 2025 deals with another deal that only closed in March 2026, and it mixes the current operating base with value that still depends on extra connections, dual-use projects, and storage.

This chart matters because it organizes the question correctly. Solair is the largest piece of current operating MW that entered at the end of 2025. Lahav is smaller in immediate connected MW, but much broader as a platform. Sunflower is smaller still, yet more burdened than the first read suggests, because part of the consideration was deferred and the deal came with existing project debt.

Lahav: A Mixed Platform, Not Just Current Yield

In the Lahav merger, Prime did not pay cash. It issued shares, and the total business-combination cost came to about NIS 109.8 million after deducting the fair value of the option to acquire Lahav Europe. That is the first point worth stopping on: the Germany option, with a NIS 95 million exercise premium over four years, is not part of the business combination. So even at the structural level, part of the strategic expansion story sits outside what was actually acquired through the merger itself.

What did come in? The main picture recorded at the acquisition date looked like this:

That table gets to the heart of it. Lahav did not bring Prime a simple yielding portfolio. It brought a mixed bundle: an existing layer of connected assets, another layer almost as large of assets under construction and development rights, equity-accounted holdings, and on the other side bank debt, leases, and a related-party loan. This was a platform deal.

You can see the same thing when moving from the purchase-price allocation to the year-end table of connected systems. Inside the connected portfolio at the end of 2025, Lahav mainly contributed two already-yielding layers: Green Energy with 142 systems and 11.5 MW, and Lahav Hungary with 29 systems and 15.9 MW. Together that is 27.4 MW of connected capacity, which generated about NIS 8.7 million of revenue during the partial consolidation window of 2025. That is real operating base, but it is not all that the merger is supposed to create.

At the same time, Lahav also contains an enhancement layer that was not yet producing at the report date. The company describes a ground-mounted project of about 17.6 MW combined with about 70 MWh of storage, meant to sell electricity under the market model, but which had not yet reached commercial operation by the reporting date. That is the line between platform and yield. Lahav gave Prime width, geography, and project inventory, but not all of that width had already turned into revenue.

Sunflower And Solair: Asset Purchases, Not Acquired Management Engines

The easy mistake is to discuss Sunflower and Solair as if they were simply an extension of Lahav. The accounting itself says otherwise. In both deals, the company states that the acquired activity was treated as an asset acquisition rather than a business combination under IFRS 3, because the systems were already connected and the acquired activity only included electricity generation and simple maintenance, without employees and without substantive development, planning, or construction processes.

That says something more important than just accounting treatment. Lahav bought Prime a platform layer. Sunflower and Solair bought it yielding hardware, with upside attached. That is not the same product.

Sunflower: Current Yield Exists, But So Does Seller Financing

In Sunflower, Prime acquired 26 operating systems with total capacity of 13.1 MW. This is a real purchase of already-producing assets, with fixed, CPI-linked tariffs in the disclosed range of about NIS 1.66 to NIS 1.84 through 2032 to 2034. But the structure is far from clean.

Out of NIS 72 million of consideration, NIS 43 million was paid at closing, while the remaining NIS 29 million was deferred for up to nine months and carried 8.5% annual interest in shekels. In addition, Prime stepped into the seller's shoes with respect to owner obligations and guarantees tied to the transferred entities, which carried about NIS 129 million of loans, with maturities in 2029 through 2033 and weighted average interest of about 5.4%.

The meaning is simple: Prime bought current yield here, but it also bought time. Part of the consideration was pushed forward, and the future return still has to support a structure that arrived with debt attached. That matters even more because, in the selected evidence set used for this follow-up, the company does not provide a clean first-year revenue and EBITDA baseline for Sunflower before enhancement. So anyone arguing for a quick step-up in value is leaning mainly on the enhancement plan, not on a disclosed operating baseline.

Solair: The Current Yield Base Is Clearer, But The Enhancement Is Still Future

In Solair, the picture is clearer. The company acquired 161 operating systems with total capacity of 53.7 MW, with guaranteed tariffs in the disclosed range of 24.5 to 45 agorot through 2044 to 2047. At closing, it paid NIS 30 million plus about NIS 7.8 million of working-capital adjustments, and at the same time stepped into about NIS 187 million of non-recourse financing obligations.

Here the company also discloses a clearer current-yield baseline. In the first year after closing, and before any material enhancement work, the acquired systems are expected to generate about NIS 26 million of revenue and about NIS 16 million of EBITDA. That matters because it gives a real anchor: one can debate whether the future enhancement will work, but there is already a disclosed operating base separated from the more optimistic scenario.

That is exactly why discipline matters. Anything above NIS 26 million of revenue and NIS 16 million of EBITDA already depends on what the company plans to do after the acquisition: additional interconnections, storage, and significant dual-use and storage build-out alongside some of the existing systems. In other words, the current yield exists, but the "enhanced platform" rerating still depends on execution.

This chart sharpens why it is wrong to read the acquired clusters only through MW. In both deals, most of the volume did not arrive on a clean sheet. Sunflower came with both deferred seller financing and existing debt. Solair came with financing obligations that were already embedded in the assets.

The Presentation Is Already Working On A Pro Forma Basis

This is where the gap between filing and management narrative becomes important. In the March 2026 presentation, the company presents "acquired yielding portfolios" of 77 MW for development and enhancement, with about NIS 66 million of annual revenue addition. If you only look at year-end 2025, that number does not close on its own: Sunflower and Solair together amount to 66.8 MW. To reach 77 MW, the company is already including the additional deal signed on February 10, 2026 and closed on March 12, 2026, for 55 operating systems with about 9.7 MW.

That is not a criticism of the presentation. It is simply a reminder that management is already telling the story on a pro forma basis, not only from the December 31, 2025 finish line. That additional deal is also financed almost entirely through a dedicated bank loan of about NIS 26.2 million. So even after year-end, growth in the yielding portfolio continues to arrive together with new financing, not instead of it.

The same logic appears on the financial slide. The company highlights about NIS 674 million of book value in income-producing systems, about NIS 254 million in systems under construction, and about NIS 500 million of cash and cash equivalents on a post-balance-sheet basis. That helps explain why the story suddenly looks much larger. But a larger balance sheet is not the same thing as yield already locked in. Part of it is current operating yield, and another part is value waiting for enhancement, financing, or connection.

The summary slide in the presentation says the same thing almost by accident: it combines "income-producing assets" with "assets that have significant enhancement potential." From a management perspective that makes sense. From an analytical perspective, those are two very different kinds of value.

Bottom Line

What did Prime really buy? Lahav bought it a platform. Sunflower and Solair bought it operating systems. What has it still not fully bought? The enhancement.

In Solair there is already a clear pre-enhancement anchor, about NIS 26 million of revenue and NIS 16 million of EBITDA. In Sunflower there is a real yielding base, but in the selected evidence set the company still does not give it a similarly clean first-year baseline, even though the deal clearly arrived with NIS 29 million of seller financing and about NIS 129 million of debt. In Lahav, Prime acquired real assets, but also a large layer of projects, holdings, and obligations, which means the merger widened the platform much faster than it widened accessible yield.

The key line is this: Prime did buy existing electricity output. It still has not proven that the entire enhancement story wrapped around those portfolios already exists at the cash level. For that to happen, the next reports need to show three things at once: that Solair and Sunflower are starting to contribute visibly in the consolidated numbers, that the enhancement projects are moving from intention to commercial operation, and that the debt and financing layers attached to the deals are not consuming most of the value before it reaches shareholders.