Israeli Alon Group to sell fuel retailing subsidiary

Israeli oil and supermarket retailer Alon Holdings Blue Square will sell subsidiary Dor Alon Energy, which holds 212 gas stations in Israel, in an effort to reduce the huge debt held by their supermarket chain Mega.

As part of a debt arrangement involving supermarket chain Mega,  parent company Alon Israel Oil Ltd. and Alon Holdings Blue Square, owner of Mega, have decided to put 72% of their shares in retailing subsidiary Dor Alon Energy up for sale, reports Globes.

The board of directors of Alon Israel Oil, which owns 80% of the shares of Alon Holdings Blue Square, hopes the share sale will avert the possible bankruptcy of the supermarket chain.

Dor Alon Energy currently holds a retail network of 212 gas stations, 173 convenience stores located inside and outside filling stations under the Alonit brand, and 46 stores in Tel Aviv under the AM:PM brand name.

Subsidiary Don Alon Energy (TASE: DRAL) has an estimated market capitalization of NIS 350 million (USD 92 million).

The Israeli retail market has two other gas station companies up for sale, Sonol Israel Ltd. and Ten Petroleum Company Ltd., which may make it difficult for Alon Holdings Blue Square to successfully offload its Dor Alon Energy shares.