Azrieli’s Stock is Plunging, Here’s why
Azrieli’s Norwegian server farm subsidiary reported that it has not received regulatory approval to build a 120MW data center for one of the world's leading tech giants. As a result, the company is now exploring alternative land options—but with no
binding agreement in place, investors fear the deal could slip away. Azrieli’s stock is down 8%.
Azrieli Group’s stock plunged after a worrying update from its subsidiary Green Mountain, the Norwegian data center company that builds facilities for major global tech firms. Green Mountain announced that Norwegian regulators
have denied approval for a 120MW data center it planned to construct for one of the world’s top technology companies.
There is currently no binding agreement between Green Mountain
and the tech company, and while Green Mountain has stated that it is exploring alternative land options, investors are concerned that the company may lose the deal entirely.
While
Green Mountain did not disclose the client’s identity, the company has previously revealed that 90% of its revenue comes from hyperscale and cloud clients, including tech giants like Google, Amazon, and Meta. Given that, it’s likely the project involves one
of these companies—or a similar major player.
How Big Is the Deal?
Though data center construction costs vary by project, industry estimates
suggest that each MW costs between $4 million and $10 million to build. That means this deal could have been worth hundreds of millions of dollars for Green Mountain—making it a significant setback if the project is ultimately scrapped.
Green Mountain: A Key Growth Engine for Azrieli
Green Mountain has been positioned as one of Azrieli’s most important growth drivers. Azrieli acquired the company in 2021, and
total investment in the subsidiary has reached 2.8 billion ILS. There have even been reports that Azrieli considered listing Green Mountain on the London Stock Exchange at a valuation of $3.2 billion (over 11 billion ILS).
Azrieli has stated that it expects its data center business to grow from 12% of total operations to 25% in the coming years—not by reducing other segments, but through expansion in this high-growth sector.
At an investor conference last year, Dana Azrieli spoke about the company’s long-term vision for data centers: "Even back in 2017, it was clear that everyone had smartphones, and people
were already talking about autonomous vehicles. Even though the industry wasn’t fully developed yet, I was convinced that the demand for data would grow exponentially," she said.
"Think
about photos alone—people used to take 4 or 5 pictures, and now with smartphones, they take 400. Two-thirds of the world—6.5 billion people—are connected to the internet. On average, people spend more than 3 hours a day online. Every minute, 3 million photos
are uploaded, and 19 million text messages are sent. All of this data has to be stored somewhere—and someone has to pay for the space where it sits. So why shouldn’t they pay me?"
What’s Next?
The denied approval for the Green Mountain data center project introduces uncertainty for Azrieli’s fast-growing digital infrastructure business. While the company is looking for alternative solutions, investors are
clearly spooked by the possibility of losing a major client.
With data center expansion at the heart of Azrieli’s future growth plans, the coming months will be critical in determining
whether Green Mountain can secure a new site and keep the deal alive—or whether this regulatory roadblock could disrupt the company’s trajectory.
One of the biggest Nike franchisees is Israeli, here's how the relationship works
Retailors jumped following Nike’s surge on Wall Street; as a key Nike franchisee, Retailors benefits from Nike’s success but also feels the impact of its weaknesses. After a tough year, Nike is under new leadership aiming to get the company back on
track. Meanwhile, Retailors continues to strengthen its partnership with Nike, including an expansion into France
Nike’s stock surged on Wall Street, and in Tel Aviv—Retailors was rising. The connection between the two isn’t new, and it’s expected to continue shaping Retailors’ trajectory. Nike accounted for 68% of Retailors’ revenue in
the first nine months of 2024, and Retailors is one of Nike’s largest franchisees worldwide. Beyond its stores in Israel, the company operates Nike stores in Canada, Australia, New Zealand, and various European countries—and has recently expanded into France.
In many ways, Retailors is Nike. While the company holds franchise rights for additional brands like Foot Locker, Champion, and Converse, Nike is its dominant business—both financially
and in terms of brand perception. That means when Nike soars, Retailors benefits, and when Nike stumbles, Retailors takes a hit.
Nike’s Decline and Recovery
Nike’s stock had a rough year. Under its former CEO, John Donahoe, the company prioritized online sales at the expense of physical retail. The strategy worked well during COVID, but as consumers returned to malls, Nike lost shelf space to emerging brands
like On and Hoka.
The major downturn came in June, when Nike issued a weak revenue forecast for the upcoming year. The stock plunged 20% in a single day, dragging Retailors down
with it, causing a 10% drop on the Tel Aviv exchange.
Now, Nike is under new-old leadership. Elliott Hill, who spent 32 years at the company before retiring in 2020, has been called
back as CEO. The expectation is that Hill will refocus on physical retail, a strategy that could restore investor confidence and lift Nike’s stock, which is currently trading at its pandemic-era price levels.
