Rapac Energy After Synergy: Who Funds Ramat Hagalil, and Who Bears the Cost

What This Follow-Up Is Isolating

The parent piece argued that Ramat Hagalil is the near-term proof point for the energy platform. This follow-up isolates the financing architecture, because this is where the gap sits between a project that looks "closed" on paper and a project that can actually move forward without drawing capital from the rest of the system.

Three points drive the thesis. First, Ramat Hagalil's financial close is not the end of the funding story. It is the gate that allows senior project debt to come in. Second, the availability agreements with Cellcom and a second private supplier make the cash flow more bankable, but they do not replace equity. Third, the same milestone that lets the bank step in also triggers a material additional payment to Synergy's sellers, which means the same event that de-risks execution also increases the funding burden above the SPV.

The easy mistake is to treat this as one financing package. It is not. There is project debt at the project company, a bridge facility that had to be expanded before first draw, a Rapac Energy corporate facility for the equity leg, and a seller payment sitting above both. In other words, Ramat Hagalil is not funded by "the bank". It is funded by a bank, partners, Rapac Energy, the parent, and the sellers, each at a different layer.

Who Actually Funds Ramat Hagalil

At year-end 2025, Ramat Hagalil was still disclosed with only a NIS 33.3 million credit framework and NIS 25.9 million of loan balances. That matters because it shows how sharp the jump was between year-end and the February-March 2026 events. After project financing was signed, the disclosed package jumped to roughly NIS 850 million, and the company also disclosed that the bridge line had been increased in the first quarter of 2026 from NIS 75 million to NIS 159 million until the first project draw.

That is the first financing layer: Bank Discount funds the project company. But even here, the detail matters. Out of the roughly NIS 850 million package, about NIS 700 million is for project construction, about NIS 42 million is for leverage increase, and about NIS 100 million is for ancillary lines such as debt-service reserve, dealing room, VAT, working capital and guarantees. This is not just a build loan. It is a full bankability wrapper. The disclosed debt-to-equity ratio is 80% debt and 20% equity, which means that once the bank steps in, the equity leg still remains with the owners.

That leads to the second layer: Rapac Energy itself. In March 2026 it signed a facility of up to NIS 200 million with Bank Leumi to finance its share of the equity required for approved projects and future approved projects, including backlog. This is not a Ramat Hagalil-only line, but the direction is obvious. The terms are not light: full principal grace only through the end of 2027, then quarterly amortization, net debt to free cash flow tests, net debt to net CAP tests, and forecast and historical ADSCR, the debt-service coverage ratio, not below 1.05. On top of that, shareholder loans to Rapac Energy cannot be repaid while the debt is outstanding, and there are restrictions on disposing of Rapac Energy assets. The line creates oxygen, but it also puts the group under a tighter financial regime.

The third layer sits above Rapac Energy, at the parent. During January 2025 the parent took an NIS 80 million loan for the Synergy acquisition, the development of Synergy projects and the repayment of external financing taken by Synergy. Later in the year that borrowing was expanded, and by year-end 2025 the material bank debt stood at NIS 130 million, repayable in one bullet in September 2026. So even before the March 2026 corporate facility, the parent had already started financing the Synergy transaction and project development through its own balance sheet.

The fourth point is that the Shamir transaction does not solve the problem either. The company disclosed an agreement to sell 5% of the project rights and 5% of the general partner to Shamir, but the consideration was disclosed as not material. That means it is a light burden-sharing step, not a real funding event. If the sale closes, Rapac Energy's indirect stake falls to 70% from 75%, but it is hard to call that a financing solution.

Some Of The Money Also Circulates Back Into The Group

There is another layer that is easy to miss. The project company signed an EPC agreement with Elmor Energies Renewable for about NIS 274 million, plus a storage procurement package of about USD 72 million. It also signed an O&M agreement worth about NIS 3.5 million per year, CPI-linked from year four. Put differently, part of the financing coming down from the bank is expected to circulate back into another operating leg inside the group. That helps Elmor's revenue quality, but it does not erase the fact that Rapac Energy and the parent still need to fund the equity leg and absorb the financing costs above the project.

Availability Economics Make The Project Bankable, Not Free

The availability agreements are not decorative. They sit at the core of Ramat Hagalil's economics. At the end of December 2025 the project company signed a 10-year 50 MW availability agreement with Cellcom Energy, with expected total consideration of about NIS 300 million to NIS 350 million. Five days later it signed another 50 MW availability agreement with a private supplier for roughly three years, with expected total consideration of about NIS 80 million to NIS 100 million. Together, the two agreements point to about NIS 380 million to NIS 450 million of disclosed expected consideration across their terms.

What matters is not only the size, but the quality. The company makes clear that availability certificates are granted for making capacity available to the system, and that they are meant to provide the project with stable income that is not directly dependent on half-hour power price volatility. Add to that the Electricity Authority approval from late February 2026, under which the facility is entitled to an adjustment coefficient through 31 December 2035, subject to license and regulatory conditions. That is exactly the type of structure a project lender wants to see: cash flow that leans more on contractual and regulatory availability economics and less on spot-market electricity pricing.

But this is where it is important to stop before over-reading it. Availability economics make the project more bankable, not more liquid in the near term. The value is spread over years, depends on the start of availability supply and commercial operation, and the company itself says the project is expected to reach commercial operation only in the second half of 2027. So the NIS 300 million to NIS 350 million and NIS 80 million to NIS 100 million figures cannot be treated as a 2026 answer to the funding question. They support future debt service. They do not replace equity and seller payments today.

Who Bears The Post-Synergy Cost

This is the heart of the story. In the Synergy acquisition, Rapac Energy paid roughly NIS 30 million at closing, but the real burden sat in the performance-linked future consideration of up to NIS 230 million, plus annual interest. The company explicitly says that most of that additional payment is tied to financial-close milestones at Synergy's key projects. At acquisition, the group recognized a NIS 163.4 million liability. By year-end 2025, the fair value had already increased to about NIS 172.7 million. That increase alone generated NIS 9.365 million of finance expense in 2025.

The message is sharp: Ramat Hagalil's financial close does not just reduce risk. It also opens a bill. The company disclosed that signing the project financing agreements entitles the sellers to part of the additional consideration, and under this milestone the sellers are entitled to NIS 120 million within 90 days of signing the financing agreements or 30 days after the first draw, whichever comes first. Out of that amount, NIS 40 million is meant to be provided back to Rapac Energy as a vendor loan for 12 months and 24 months.

This is exactly where the question of who bears the cost gets a real answer. The bank funds the project company. Availability buyers help frame future cash flow. Elmor gets work and revenue. But Synergy's sellers do not waive the consideration. They only defer part of it, and even that deferral is fairly short. More importantly, the parent provided a guarantee of up to NIS 230 million in favor of the sellers, subject to milestones. So even when part of the payment is pushed out, the risk does not disappear from the group. It simply changes form.

The comparison with liquidity shows how material this is. At year-end 2025, the group had NIS 181.5 million of cash and cash equivalents, against NIS 172.7 million of fair-valued contingent consideration. That does not mean all the cash is earmarked for sellers, but it does mean that the seller obligation already sits in the same order of magnitude as the consolidated cash pile. The right reading is therefore not "the project has financing", but "the project has moved from a development event to a capital event".

What Needs To Happen Now For This Structure To Work

Checkpoint one: the first draw needs to happen on time so the bridge layer can be taken out. Any delay keeps the most temporary and timing-sensitive funding layer alive.

Checkpoint two: Rapac Energy has to use the corporate facility to fund its share of the equity leg without choking the parent's flexibility. The line exists, but it comes with restrictions on shareholder-loan repayment and asset disposals.

Checkpoint three: the company needs to show how the NIS 120 million seller milestone is actually paid in practice and how much truly remains deferred as vendor financing. It looks technical, but it determines how much real cash leaves now and how much is pushed out.

Checkpoint four: the project has to keep moving toward a second-half 2027 commercial start without erosion in availability economics, regulation or timetable. Any slippage hits the exact layer that is supposed to justify the leverage.

Bottom Line

Ramat Hagalil now looks much more bankable, but not much easier. Senior debt, the availability agreements and the Electricity Authority approval create a stronger base for the project. At the same time, that very financial close triggers a material seller payment, forces Rapac Energy to fund the equity leg through a corporate facility, and keeps the parent inside the funding loop.

That is the key conclusion: the bank funds the debt layer, availability buyers fund part of the certainty, Elmor benefits from part of the execution economics, but Rapac Energy and the parent remain the ones carrying the equity layer and the price opened up by the Synergy transaction.