Leumi Partners will invest 171 million shekels in Generation’s waste management arm.

Leumi Partners, the investment arm of Bank Leumi, will acquire a 15% stake in Generation’s waste management arm, which is being consolidated under the company BlueGen. The transaction will be executed at a valuation slightly above the unit’s book value in Generation’s financial statements and reflects a threefold increase compared to the fund’s original investment in the business

Leumi Partners – Bank Leumi’s investment arm – will invest 171 million shekels in Generation Capital’s new waste management arm, in exchange for 15% of the shares of the division, which is currently being organized under BlueGen.
According to the memorandum of understanding, of the 15% stake to be received by Leumi Partners, it will purchase 10% from BlueGen for 108 million shekels (cash paid out), and will be issued additional shares raising its holding in the waste division to 15%, for an additional 63 million shekels (cash injected into the business).

The transaction reflects a pre-money valuation of 1.075 billion shekels, slightly above the valuation of the waste division as recorded in Generation’s books as of June 2025. The agreement also includes a two-year upside mechanism, under which the valuation will be adjusted if another capital event occurs in the acquired business at a higher valuation than agreed, plus a pre-determined return.

According to Generation, managed by Erez Balasha and Yossi Zinger, the valuation attributed to BlueGen’s share in the waste division stands at 848 million shekels, implying an annual internal rate of return (IRR) of 38% on Generation’s investment in the division’s underlying assets.

In total, BlueGen invested 350 million shekels in the division’s assets and has received cumulative cash flows of 61 million shekels. The implied valuation of around 850 million shekels represents a threefold increase compared to Generation’s net initial investment (investment amount minus proceeds from the assets). The waste assets currently generate stable annual cash flows in the tens of millions of shekels, which are expected to grow further once assets under development begin operation.

Leumi Partners – which recently appointed Victor Vakrat as its new CEO – is already a partner with Generation in Bon Tour. Generation CEO Erez Balasha said about the deal: “The entry of Leumi Partners as a partner in Generation’s waste division marks a significant milestone for us. The waste assets already generate strong and stable cash flows, and we view this division as a platform with substantial potential for long-term value creation.”