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Loans | 12 Months Ended
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Dec. 31, 2023
Loans [Abstract] |
Loans | Note 11 - Loans
| A. | Loans details
Composed as follows:
|  | Linkage |  | Interest rate |  | December 31 |  |  | December 31 |
|  | terms |  | 2022 and 2023 |  | 2023 |  |  | 2022 |
Bank loans |  |  |  | % |  | € in thousands |
|  | EURIBOR |  | 2 - 6 |  |  | 21,132 |  |  |  | 23,918 |
|  | - |  | 2.58 - 3.03 |  |  | 156,748 |  |  |  | 164,212 |
|  | Bank of Israel interest rate |  | 4.35 - 9.1 |  |  | 5,509 |  |  |  | 2,986 |
|  | Consumer price index in Israel |  | 2.75 - 4.78 |  |  | 64,176 |  |  |  | 51,165 |
|  |  |  |  |  |  | 247,565 |  |  |  | 242,281 |
Current maturities |  |  |  |  |  |  | 9,784 |  |  |  | 12,815 |
Long-term loans |  |  |  |  |  |  | 237,781 |  |  |  | 229,466 |
|  | Linkage |  | Interest rate |  | December 31 |  |  | December 31 |
|  | terms |  | 2022 and 2023 |  | 2023 |  |  | 2022 |
Other long-term loans |  |  |  | % |  | € in thousands |
|  | EURIBOR(1) |  | 5.27-9.2 |  |  | 25,055 |  |  |  | 23,247 |
|  | Consumer price index in Israel |  | 7 |  |  | 5,806 |  |  |  | 4,857 |
|  | Fixed |  | 5 - 5.5 |  |  | 3,512 |  |  |  | 3,478 |
|  |  |  |  |  |  | 34,373 |  |  |  | 31,582 |
Current maturities |  |  |  |  |  |  | 5,000 |  |  |  | 10,000 |
Other long-term loans |  |  |  |  |  |  | 29,373 |  |  |  | 21,582 |
(1) | Loans provided by the minority (49%) holders in Talasol.
Israel - Ellomay PS Loans
| 1. | The Company’s 83.333% owned Israeli subsidiary promoting the Manara PSP, Ellomay PS, entered into a loan agreement with Ampa, the owner of the remaining 16.667% of its outstanding shares. The unpaid balance (principal and interest) of the loan is split into 2 separate loans, an interest-bearing loan at an annual rate of 7% linked to the consumer price index (senior international debt), and a mezzanine loan (an internationally inferior debt) bearing an annual interest rate of 5%. The maturity date of this loan starts from December 31, 2027. As of December 31, 2023, the amount of the loan is NIS 33,910 thousand (€8,452 thousand).
| 2. | On February 11, 2021, the Manara PSP Project Finance achieved financial closing. The Manara PSP Project Finance facilities are provided by a consortium of Israeli banks and institutional investors, arranged and led by Mizrahi-Tefahot Bank Ltd. The Manara PSP Project Finance long-term facilities were originally in the aggregate amount of approximately NIS 1.27 billion (approximately €338 million). This aggregate amount represents the real (non-indexed) value of the Long-Term Facilities as of the date of financial closing. Such amount, as well as the standby facilities, is linked to a synthetic composite index comprising a weighted average of the indices and currencies applicable to the Manara PSP’s construction costs (the “Project Index”), on an annual basis during the first 4 years of construction, and thereafter semi-annually until construction end. As a result of the linkage to the Project Index, the long-term facilities amount increased in March 2022 and March 2023 by approximately NIS 40 million (approximately €10.6 million) and approximately NIS 63 million (approximately €16.8 million), respectively.
The Manara PSP Project Finance facilities includes two Long-Term Facilities: (i) a Senior Secured A Tranche at a fixed rate of interest for each drawdown, with base interest rate equal to the yield to maturity of Israeli treasury bonds with like duration of the drawn loan, plus a spread of 3.25% per-annum during the Construction Period of the Project and a spread of 2.40% per-annum from the Actual Completion Construction Date. The Senior Secured Tranche is linked to the Israeli Consumer Price Index and is to be repaid over a period of 19.5 years from the commercial operation date; and (ii) a Subordinated Secured B Tranche at a floating rate of interest, with the base interest being the Bank of Israel rate, plus a spread of 4.35% per-annum during the construction period and a spread of 3.90% per-annum from the Actual Completion Construction Date. The stated maturity of the Tranche B loan is one year less than the maturity of the Senior Secured Loan with a cash sweep mechanism that shortens its maturity to approximately 12 years from the commercial operation date under the Base Case Financial Model and the Manara PSP Project Finance also includes standby facilities (Tranche A and Tranche B). The Manara PSP Project Finance includes customary terms in connection with early prepayment, acceleration of payments upon certain breaches and limitations on distributions. The Manara PSP Project Finance also includes ancillary facilities VAT, Guarantees and Debt Service Reserve facilities in an aggregate amount of approximately NIS 64 million (approximately €17.1 million). The Manara PSP Project Finance includes mandatory cash sweeps upon certain cover ratio and other events with respect to the Senior Secured Tranche, cash sweep payments in connection with the Subordinated Secured Tranche as mentioned above and other lender protection mechanisms. In addition, the Manara PSP Project Finance agreement permits the owners of the Manara PSP to drawdown a developers’ fee on the Actual Completion Construction Date (as such term is defined in the Manara PSP Project loan agreements) of the Manara PSP, subject to availability of funding in the Standby Facility at the time and provided the Average ADSCR at the time is not less than a ratio of 1.28. Ellomay and Ampa provided certain sponsor support undertakings towards the lenders commensurate with the size and complexity of the project and the length of the construction period, including a standby equity guarantee in the aggregate amount of approximately NIS 12.5 million (approximately €3.3 million), pro rata to their holdings in the Manara PSP. This standby equity guarantee is linked monthly to the Israeli CPI and adjusted (if applicable) in the same manner and timing as the Long-Term Facilities, as described above. As of December 31, 2023 a total aggregate amount of NIS 245,656 (€65,452 thousand) was drawn down under the Manara PSP Project Finance from the Senior Secured Tranche (interest rate range between 2.75%-4.78% linked to the Israeli Consumer Price Index) and a total aggregate amount of NIS 20,875 (€5,527 thousand) was drawn from the Subordinated Secured B Tranche (floating interest rate based on the Bank of Israel Rate – 9.1% as of December 31, 2023). The Netherland - Bio Gas - Loans
| 1. | Groen Goor and Ellomay Luxembourg entered into a senior project finance agreement in 2017 (the “Goor Loan Agreement”), with Coöperatieve Rabobank U.A. (“Rabobank”), that includes the following tranches: (i) two loans with principal amounts of €3,510 thousand (with a fixed interest rate of 3% until the end of 2021 and with a fixed interest rate of 3.45% for the next five years) and €2,090 thousand, (with a fixed interest rate of 2.5% until the end of March 2022 and then with a fixed interest rate of 2.65% until the end of March 2023 and with a fixed interest rate of 6.05% until the end of March 2026), for a period of 12.25 years, repayable in equal monthly installments commencing three months following the connection of the Goor Project’s facility to the grid and (ii) an on-call credit facility of €370 thousand with variable interest. The amount of €5,600 thousand was withdrawn in 2017 on account of these loans. In connection with the Goor Loan Agreement, the following securities were provided to Rabobank: (i) pledge on the present and future rights arising from the feedstock purchase agreement, the EPC agreement, the O&M agreement, the SDE subsidy, the various power and green gas purchase agreements, and the green gas certification supply agreement, (ii) pledge on all present and future (a) receivables arising from business and trade, and (b) stock and inventory including machinery and transport vehicles of Groen Goor, and (iii) all rights/claims of Groen Goor against third parties existing at the time of the execution of the Loan Agreement, including rights from insurance agreements.
| 2. | Groen Gas Oude-Tonge and Ellomay Luxembourg entered into a senior project finance agreement (the “Oude Tonge Loan Agreement”), with Rabobank, that includes the following tranches: (i) three loans with principal amounts of €3,150 thousand (with a fixed interest rate of 3.1% the end of June 2022 and with a fixed interest rate of 3.95% for the next three years), €1,540 thousand (with a fixed interest rate of 2.9% until the end of March 2023 and with a fixed interest rate of 5.15% for the next five years) and €160 thousand, (with a fixed interest rate of 3.4% until the end of March 2023 and with a fixed interest rate of 5.65% for the next five years), for a period of 12.25 years, repayable in equal monthly installments commencing three months following the connection of the Oude Tonge Project’s facility to the grid and (ii) an on-call credit facility of €100 thousand with variable interest. The amount of €4,850 thousand was withdrawn in 2017 and 2018 on account of these loans.
In connection with the Goor Loan Agreement and the Oude Tonge Loan Agreement Ellomay Luxembourg, the Company’s wholly-owned subsidiary: (i) provided the following undertakings to Rabobank: (a) that Groen Goor and Groen Gas Oude Tonge, as applicable, will not make distributions to its shareholders for a period of two years following the execution of the Loan Agreement, (b) that Groen Goor will not make distributions or repurchase its shares so long as the equity (including owners loans) to total assets ratio of Groen Goor is less than 40%, (c) that in the event the equity (including owners loans) to total assets ratio of Groen Goor and Groen Gas Oude Tonge will be below 40%, its shareholders will invest the equity required in order to increase this ratio to 40%, pro rata to their holdings in Groen Goor and Groen Gas Oude Tonge, as applicable, and up to a maximum of €1.2 million, and (d) that they will provide the equity required for the completion of the Goor Project (ii) provided pledges on their respective rights in connection with the shareholders loans which each provided to Groen Goor and Groen Gas Oude Tonge, which loans shall also be subordinated by Ellomay Luxembourg in the favor of Rabobank. In addition, the Company provided a guarantee to Rabobank for the fulfillment of Ellomay Luxembourg’s undertakings set forth above.
| 3. | GG Gelderland entered into a senior project finance agreement (the “Gelderland Loan Agreement”), with Rabobank, that includes the following tranches: (i) four loans with principal amounts of (a) €2,453 thousand (with a fixed interest rate of 3.6% for the first five years), (b) €1,200 thousand (with a fixed interest rate of 4.5% until the beginning of December 2020 and with a fixed interest rate of 3.5% until the beginning of December 2025), (c) €400 thousand (with a fixed interest rate of 3.55% until the end of January 2023 and with a fixed interest rate of 5.95% until the end of the loan period) and (d) €2,847 thousand (with a fixed interest rate of 4.5% until the beginning of December 2020 and with a fixed interest rate of 3.5% until the beginning of December 2025), all for a period of 12 years (144 monthly payments), repayable in equal monthly installments and (ii) an on-call credit facility of €750 thousand with variable interest. An aggregate amount of €6,900 thousand was withdrawn in 2015, 2016 and 2018 on account of these loans. On November 30, 2020, GG Gelderland replaced the loan set forth in (i)(a) above, which as of that date had an outstanding principal amount of €1,890 thousand, with another loan from Rabobank with a fixed interest rate of 3.1% per year, repayable in 56 payments monthly, with a repayment of principal in one payment in August 2025.
In connection with the Gelderland Loan Agreement, the following securities were provided to Rabobank: (i) pledge on the present and future rights arising from the feedstock purchase agreement, the EPC agreement, the O&M agreement, the SDE subsidy, the various power and green gas purchase agreements, and the green gas certification supply agreement, (ii) pledge on all present and future (a) receivables arising from business and trade, and (b) stock and inventory including machinery and transport vehicles of GG Gelderland, and (iii) all rights/claims of GG Gelderland against third parties existing at the time of the execution of the Gelderland Loan Agreement, including rights from insurance agreements. In connection with the Gelderland Loan Agreement, Ellomay Luxembourg, the Company wholly-owned subsidiary, provided the undertaking to Rabobank that Ellomay Luxembourg will not sell the shares of GG Gelderland without the prior written consent of Rabobank.
| 4. | GG Gelderland, entered into a loan agreement in the end of November 2020, with Ontwikkelingsnaatscgappij Oost-Nederland N.V. (“Oost”), as a benefit created in connection with the Covid-19 pandemic. The loan is with a principal amount of €750 thousand bore a fixed interest rate of 3 % per year for 3 years. The interest and the principle were to be fully repaid in one single amount after 3 years. According to the agreement with Oost, the loan term may be prolonged to 5 years. In October 2023, it was decided to extend the loan to 5 years and the interest rate changed to 5% as from November 2020.
Spain - Loans On March 12, 2019, four of the Company’s Spanish subsidiaries (together, the “Subsidiaries”) entered into a €18.4 million project finance Facility Agreement (the “Facility Agreement”). The €18.4 million principal amount is divided into: (i) four term loan facilities, one for each Subsidiary, in the aggregate amount of €17.6 million with terms ending in December 2037, and (ii) a revolving credit facility to attend the debt service if needed, for a maximum amount of euro 0.8 million granted to any of the Subsidiaries. The loans provided under the Facility Agreement bear an annual interest at the rate of Euribor 6 months plus a margin of 2% (with a zero interest floor) and repaid semi-annually on June 20 and December 20. The principal is repaid on a semi-annual basis based on a pre-determined sculptured repayment schedule. The Facility Agreement provides for mandatory prepayment upon the occurrence of certain events and includes various customary representations, warranties and covenants, including covenants to maintain a DSCR on an aggregate basis not lower than 1.05:1, and not to make distributions unless, among other things: (i) the DSCR, on an aggregate basis, is equal to or higher than 1.15:1.0, (ii) the first instalment of the Project Finance has been repaid, (iii) no amount under the revolving credit tranche has been withdrawn and not fully repaid and no drawdowns of the revolving credit tranche are expected within the next six months, and (iv) the Subsidiaries’ net debt to regulatory value (as such terms are defined in the Facility Agreement) ratio is equal to or higher than 0.7:1. The regulatory value of the PV Plants owned by the Subsidiaries is approximately €23.5 million, compared to their aggregate nominal purchase price, which was approximately €14.85 million and their aggregate book value, which was approximately €14.6 million as of September 30, 2018. The Facility Agreements includes a cash-sweep payment mechanism and obligation that applies in the event the Subsidiaries’ net debt to regulatory value ratio is equal to or higher than 0.7:1. As of December 31, 2023, the financial covenants were met. On March 12, 2019, the Subsidiaries entered into swap agreements with respect to approximately €17.6 million (with a decreasing notional principal amount based on the amortization table) until December 2037, replacing the Euribor 6 month rate with a fixed 6 month rate of approximately 1%, resulting in a fixed annual interest rate of approximately 3%. Such swap transactions qualify for hedge accounting. See Note 21 E regarding the effect of the expected transition away from Libor and Euribor. The documents ancillary to the Facility Agreements require that security interests be provided in connection with the following: (i) the Subsidiaries’ shares (held by Ellomay Luxembourg(, (ii) pledges over accounts, (iii) pledges over relevant agreements including hedging agreements; and (iv) promissory equipment mortgage. Talasol - Loans
| 1. | In December 2021, Talasol entered into financing agreement (the “Talasol Facilities Agreement”). Financial closing of the Talasol Facilities Agreement was achieved in January 2022. The Talasol Facilities Agreement provides for the provision of two tranches:
| (a) | a term loan in the amount of €155 million of which the final maturity date is June 30, 2044, and
| (b) | a term loan in the amount of €20 million of which the final maturity date is December 31, 2042.
Principal and interest at a weighted average of approximately 3% repayment are made on a semi-annual basis, in June and December. The agreements executed in connection with the Talasol Financing provide for mandatory prepayment upon the occurrence of certain events and various customary representations, warranties, and covenants, including covenants to maintain a Historic and Forecast DSCR equal to at least 1.05x. Moreover, Talasol undertook not to make distributions in the event that: (i) the Historic and Forecast DSCR will be lower than 1.10x until the expiration date of the Talasol PPA and equal to at least 1.25x thereafter and (ii) the Loan Life Cover Ratio will be lower than 1.30x from the expiration date of the Talasol PPA and until maturity. The Talasol Facilities Agreement requires that security interests be provided in connection with the following: (i) Talasol’s shares (held by Ellomay Luxembourg and the other shareholders of Talasol), (ii) pledges over credit rights under certain accounts, (iii) pledges over credit rights under certain Talasol PV Plant’s documents, (iv) pledges over credit rights under the shareholders loans, (v) security assignment of receivables in connection with the Talasol PPA, (vi) promissory equipment mortgage and (vii) mortgage on all solar modules and power inverters comprised in the project.
| 2. | On April 30, 2019, following the closing of Talasol PV Plant and sale of 49% holdings of the Talasol Project, Talasol entered into a loan agreement with GSE 3 UK Limited and Fond-ICO Infraestructuras II, FICC (the minority shareholders of Talasol, each of whom owns 24.5% of Talasol). The unpaid balance (principal and interest) of the loan will bear interest of Euribor 6 mount plus 5.27%. The maturity date of this loan is December 31, 2037. As of December 31, 2023, the amount of the loan is €25,055 thousand.
| B. | The aggregate annual maturities are as follows:
|  | December 31 |  |  | December 31 |
|  | 2023 |  |  | 2022 |
|  | € in thousands |
Second year |  |  | 14,049 |  |  |  | 13,811 |
Third year |  |  | 13,668 |  |  |  | 15,952 |
Fourth year |  |  | 15,828 |  |  |  | 14,759 |
Fifth year |  |  | 24,462 |  |  |  | 16,026 |
Sixth year and thereafter |  |  | 199,147 |  |  |  | 190,500 |
Long-term loans |  |  | 267,154 |  |  |  | 251,048 |
Current maturities |  |  | 14,308 |  |  |  | 22,187 |
Short-term loans |  |  | 476 |  |  |  | 628 |
|  |  | 281,938 |  |  |  | 273,863 |
| C. | In order to minimize the interest-rate risk resulting from liabilities to banks and financing institutions linked to the Euribor, the Company executed swap transactions. For more information, see Note 21.
| D. | Movement in liabilities deriving from financing activities
|  |  |  | Liabilities |  |  |  |
|  |  |  | Loans and |  |  |  |  |  |  |
|  | Note |  | borrowings |  |  | Debentures |  |  | Total |
|  |  |  | € in thousands |
Balance as at January 1, 2023 |  |  |  |  | 273,863 |  |  |  | 110,428 |  |  |  | 384,291 |
Changes from financing activities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Proceeds from issue of debentures |  |  |  |  | - |  |  |  | 55,808 |  |  |  | 55,808 |
Repayment of debentures |  | 12 |  |  | - |  |  |  | (17,763 | ) |  |  | (17,763 | )
Receipt of loans |  |  |  |  | 32,157 |  |  |  | - |  |  |  | 32,157 |
Repayment of loans |  |  |  |  | (12,736 | ) |  |  | - |  |  |  | (12,736 | )
Accrued interest |  |  |  |  | 4,284 |  |  |  | - |  |  |  | 4,284 |
Linkage |  |  |  |  | 1,849 |  |  |  | - |  |  |  | 1,849 |
Transaction costs related to borrowings |  |  |  |  | (686 | ) |  |  | 446 |  |  |  | (240 | )
Transfer to disposal groups held for sale |  |  |  |  | (13,047 | ) |  |  | - |  |  |  | (13,047 | )
Total net financing liabilities |  |  |  |  | 285,684 |  |  |  | 148,919 |  |  |  | 434,603 |
Effect of changes in foreign exchange rates |  |  |  |  | (3,746 | ) |  |  | (8,832 | ) |  |  | (12,578 | )
Balance as at December 31, 2023 |  |  |  |  | 281,938 |  |  |  | 140,087 |  |  |  | 422,025 |
|  |  |  | Liabilities |  |  |  |
|  |  |  | Loans and |  |  |  |  |  |  |
|  | Note |  | borrowings |  |  | Debentures |  |  | Total |
|  |  |  | € in thousands |
Balance as at January 1, 2022 |  |  |  |  | 218,895 |  |  |  | 137,299 |  |  |  | 356,194 |
Changes from financing activities |  |  |  |  |  |  |  |  |  |  |  |  |  |
Repayment of debentures |  | 12 |  |  | - |  |  |  | (19,764 | ) |  |  | (19,764 | )
Receipt of loans |  |  |  |  | 215,170 |  |  |  | - |  |  |  | 215,170 |
Repayment of loans |  |  |  |  | (153,751 | ) |  |  | - |  |  |  | (153,751 | )
Accrued interest |  |  |  |  | 2,488 |  |  |  | - |  |  |  | 2,488 |
Linkage |  |  |  |  | 2,029 |  |  |  | - |  |  |  | 2,029 |
Transaction costs related to borrowings |  |  |  |  | (3,861 | ) |  |  | 779 |  |  |  | (3,082 | )
Issuance of capital note to non-controlling interest |  |  |  |  | (3,958 | ) |  |  | - |  |  |  | (3,958 | )
Total net financing liabilities |  |  |  |  | 277,012 |  |  |  | 118,314 |  |  |  | 395,326 |
Effect of changes in foreign exchange rates |  |  |  |  | (3,149 | ) |  |  | (7,886 | ) |  |  | (11,035 | )
Balance as at December 31, 2022 |  |  |  |  | 273,863 |  |  |  | 110,428 |  |  |  | 384,291 |

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