Kenon Navigates Geopolitical Storms, Divests ZIM Stake

TL;DR

**Kenon's 2025 20-F screams 'geopolitical risk premium' with Middle East conflicts overshadowing its power assets and a quiet exit from ZIM.**

AI Summary

Kenon Holdings Ltd. (KEN) filed its 20-F for the fiscal year ended December 31, 2025, indicating a continued focus on its power generation and automotive interests. The company holds an approximately 46% interest in OPC Energy Ltd. (OPC), a key player in Israeli and U.S. power markets, and a 12% interest in Qoros Automotive Co., Ltd., a Chinese automotive company. A significant business change noted is the complete divestment of Kenon's interest in ZIM Integrated Shipping Services, Ltd. by December 2024. The filing highlights ongoing geopolitical risks, specifically mentioning 'Operation Rising Lion' in June 2025 and 'Operation Lion's Roar' in February 2026, which could severely impact operations and financial performance in Israel and the wider Middle East. The company's strategic outlook appears to be navigating these regional conflicts while continuing to develop its power assets, such as the Ramat Bekka Project and Sorek 2, and managing its minority stake in Qoros.

Why It Matters

Kenon's 20-F reveals a company grappling with significant geopolitical instability, particularly the 'War' in the Middle East, which directly impacts its core power generation assets in Israel through OPC. For investors, this means heightened risk and potential volatility, as regional conflicts could disrupt operations and project timelines, affecting profitability and dividend potential. Employees and customers of OPC's power plants face uncertainty regarding energy supply and operational continuity. In the broader market, Kenon's divestment from ZIM by December 2024 signals a strategic shift away from shipping, while its continued, albeit minority, stake in Qoros keeps it exposed to the competitive Chinese automotive sector.

Risk Assessment

Risk Level: high — The risk level is high due to explicit mentions of 'Operation Rising Lion' in June 2025 and 'Operation Lion's Roar' in February 2026, referring to large-scale military conflicts involving Israel and Iran. These events directly threaten Kenon's significant 46% interest in OPC Energy Ltd., which operates power generation facilities in Israel, creating substantial operational and financial uncertainty.

Analyst Insight

Investors should exercise extreme caution and thoroughly assess the geopolitical risks outlined in the filing, particularly concerning Kenon's Israeli power assets. Consider reducing exposure or hedging against potential disruptions given the ongoing 'War' and explicit military conflict mentions, as these could severely impact future earnings and asset values.

Key Numbers

• 46% — Interest in OPC Energy Ltd. (Represents Kenon's significant stake in Israeli and U.S. power markets)
• 12% — Interest in Qoros Automotive Co., Ltd. (Kenon's minority stake in the Chinese automotive sector)
• 52,108,397 — Outstanding shares (As of the close of the period covered by the annual report)
• December 2024 — Date of ZIM divestment (Kenon no longer holds an interest in ZIM Integrated Shipping Services, Ltd.)
• June 2025 — Date of Operation Rising Lion (Outbreak of a large-scale military conflict between Israel and Iran)
• February 2026 — Date of Operation Lion's Roar (Military actions between Israel and the United States against Iran)
• October 7, 2023 — Start of 'the War' (Multi-front regional conflict initiated by Hamas attack in Gaza Strip)
• 62% — Ansonia Holdings Singapore B.V. ownership (Percentage of outstanding shares of Kenon owned by Ansonia)
• 70.69% — OPC's indirect interest in CPV Power Holdings LP (Represents OPC's stake in U.S. conventional energy power plants)
• 66.7% — CPV Group's ownership of CPV Renewables (Represents CPV's renewable energy activity)

Key Players & Entities

• Kenon Holdings Ltd. (company) — Registrant for the 20-F filing
• OPC Energy Ltd. (company) — Kenon holds an approximately 46% interest in this power generation company
• Qoros Automotive Co., Ltd. (company) — Kenon holds a 12% interest in this Chinese automotive company
• ZIM Integrated Shipping Services, Ltd. (company) — Kenon divested its interest in this company by December 2024
• Ansonia Holdings Singapore B.V. (company) — Owns approximately 62% of Kenon's outstanding shares
• James A. McDonald (person) — Company Contact Person from Skadden, Arps, Slate, Meagher and Flom (UK) LLP
• Israel (regulator) — Location of significant operations and geopolitical conflict
• Iran (regulator) — Country involved in military conflicts with Israel
• $6.99 (dollar_amount) — RMB per USD exchange rate on December 31, 2025
• $3.19 (dollar_amount) — NIS per USD exchange rate on December 31, 2025

FAQ

Risk Factors

• Geopolitical Instability and Regional Conflicts [high — operational]: Kenon's operations, particularly in Israel, are exposed to significant geopolitical risks. The filing explicitly mentions 'Operation Rising Lion' in June 2025 and 'Operation Lion's Roar' in February 2026, indicating ongoing and escalating regional conflicts. These events could severely impact operations, supply chains, and financial performance in Israel and the wider Middle East.
• Dependence on Key Investments [high — market]: Kenon's financial performance is heavily reliant on its significant stakes in OPC Energy Ltd. (46% interest) and Qoros Automotive Co., Ltd. (12% interest). Any adverse developments or underperformance within these entities, especially OPC which is central to its power generation strategy, could materially affect Kenon's results.
• Divestment of ZIM Integrated Shipping Services [medium — operational]: The complete divestment of Kenon's interest in ZIM Integrated Shipping Services, Ltd. by December 2024 signifies a strategic shift away from the shipping sector. While this removes a potentially volatile asset, it also means the loss of any future upside from ZIM's performance.
• Regulatory Environment in Power Markets [medium — regulatory]: As a significant player in power generation through OPC Energy Ltd., Kenon is subject to the regulatory frameworks governing energy markets in Israel and the U.S. Changes in energy policy, environmental regulations, or pricing mechanisms could impact profitability and operational flexibility.
• Minority Stake in Qoros Automotive [medium — financial]: Kenon holds a 12% minority interest in Qoros Automotive Co., Ltd. The automotive industry is capital-intensive and subject to cyclical demand and intense competition. The performance of Qoros, influenced by the Chinese automotive market, will directly impact Kenon's investment returns.

Industry Context

Kenon operates in the energy and automotive sectors. The power generation segment, primarily through its stake in OPC Energy Ltd., is focused on both conventional and renewable energy in Israel and the U.S. This market is characterized by significant capital requirements, evolving regulatory landscapes, and increasing demand for sustainable energy solutions. The automotive segment, represented by its stake in Qoros, operates within the highly competitive and rapidly changing Chinese market, influenced by technological advancements and shifting consumer preferences.

Regulatory Implications

Kenon's operations are subject to various regulatory frameworks, particularly in the energy sector. Changes in environmental regulations, energy pricing policies, and international trade policies could impact its profitability and operational strategies. The geopolitical tensions mentioned also introduce regulatory uncertainties and potential compliance challenges in affected regions.

What Investors Should Do

1. Monitor geopolitical developments in the Middle East closely.
2. Analyze the performance and strategic direction of OPC Energy Ltd.
3. Assess the outlook for the Chinese automotive market and Qoros's competitive position.
4. Evaluate the impact of the ZIM divestment on Kenon's overall strategy and capital allocation.

Key Dates

• 2024-12-01: Divestment of ZIM Integrated Shipping Services, Ltd. — Marks a strategic exit from the shipping sector, simplifying Kenon's business portfolio and reducing exposure to that industry's volatility.
• 2025-06-01: Operation Rising Lion — Highlights significant geopolitical risk in the Middle East, potentially impacting Kenon's operations in Israel and the wider region.
• 2026-02-01: Operation Lion's Roar — Indicates continued or escalating regional military actions, posing severe risks to Kenon's operational continuity and financial performance in affected areas.
• 2023-10-07: Start of 'the War' — The initial major regional conflict event that has led to subsequent escalations, underscoring the persistent geopolitical instability affecting Kenon's core markets.

Glossary

OPC Energy Ltd.

A company involved in owning, developing, and operating power generation facilities in Israel and the United States. (Kenon holds a significant 46% interest in OPC, making it a core component of Kenon's power generation business and a key driver of its financial performance.)

Qoros Automotive Co., Ltd.

A Chinese automotive company in which Kenon holds a 12% interest. (Represents Kenon's exposure to the Chinese automotive market, a sector known for its rapid growth but also intense competition and regulatory scrutiny.)

Ansonia Holdings Singapore B.V.

The entity that owns approximately 62% of the outstanding shares of Kenon. (As the majority shareholder, Ansonia's influence and strategic decisions can significantly impact Kenon's direction and governance.)

CPV Power Holdings LP

A business engaged in the development, construction, and management of conventional energy power plants in the United States. (OPC holds an indirect interest of approximately 70.69% in CPV Power Holdings LP, indicating a substantial investment in U.S. conventional energy infrastructure.)

CPV Renewables

CPV's renewable energy activity, held through CPV Renewable Power LLC. (This segment, where CPV Group owns 66.7%, represents OPC's (and by extension Kenon's) involvement in the growing renewable energy sector.)

Operation Rising Lion

A specific military conflict event mentioned in the filing occurring in June 2025. (Highlights a concrete example of the severe geopolitical risks Kenon faces in the Middle East, directly impacting its operational environment.)

Operation Lion's Roar

Another specific military action mentioned in the filing, occurring in February 2026. (Further emphasizes the ongoing and potentially escalating nature of regional conflicts that pose significant threats to Kenon's business operations.)

Year-Over-Year Comparison

The most significant change from the previous filing is the complete divestment of Kenon's interest in ZIM Integrated Shipping Services, Ltd. by December 2024, marking a strategic pivot away from the shipping industry. While specific financial metric comparisons are not detailed here, the filing highlights increased geopolitical risks with the mention of 'Operation Rising Lion' and 'Operation Lion's Roar', suggesting a heightened risk environment compared to prior periods. The continued focus remains on developing power assets through OPC Energy Ltd. and managing the minority stake in Qoros.

Filing Documents

• zk2634883.htm (20-F) — 7113KB
• exhibit_8-1.htm (EX-8) — 9KB
• exhibit_12-1.htm (EX-12) — 16KB
• exhibit_12-2.htm (EX-12.2) — 16KB
• exhibit_13-1.htm (EX-13.1) — 8KB
• exhibit_15-1.htm (EX-15.1) — 6KB
• exhibit_15-2.htm (EX-15.2) — 2KB
• exhibit_15-4.htm (EX-15.4) — 3KB
• exhibit_15-5.htm (EX-15.5) — 669KB
• exhibit_15-6.htm (EX-15.6) — 2KB
• image0.jpg (GRAPHIC) — 2KB
• image00001.jpg (GRAPHIC) — 2KB
• image1.jpg (GRAPHIC) — 158KB
• image00002.jpg (GRAPHIC) — 2KB
• image3.jpg (GRAPHIC) — 293KB
• image00005.jpg (GRAPHIC) — 11KB
• image00006.jpg (GRAPHIC) — 2KB
• image00008.jpg (GRAPHIC) — 29KB
• image00010.jpg (GRAPHIC) — 25KB
• img101_v1.jpg (GRAPHIC) — 3KB
• img102_v1.jpg (GRAPHIC) — 4KB
• 0001178913-26-001842.txt ( ) — 32222KB
• ken-20251231.xsd (EX-101.SCH) — 424KB
• ken-20251231_cal.xml (EX-101.CAL) — 122KB
• ken-20251231_def.xml (EX-101.DEF) — 719KB
• ken-20251231_lab.xml (EX-101.LAB) — 2768KB
• ken-20251231_pre.xml (EX-101.PRE) — 1002KB
• zk2634883_htm.xml (XML) — 6900KB

Item 18

Item 17 Item 18 If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No TABLE OF CONTENTS PART I ITEM 1. Identity of Directors, Senior Management and Advisers 1 A. Directors and Senior Management 1 B. Advisers 1 C. Auditors 1 ITEM 2. Offer Statistics and Expected Timetable 1 A. Offer Statistics 1 B. Methods and Expected Timetable 1 ITEM 3. Key Information 1 A. Reserved 1 B. Capitalization and Indebtedness 1 C. Reasons for the Offer and Use of Proceeds 1 D.

Risk Factors

Risk Factors 1 ITEM 4. Information on the Company 39 A. History and Development of the Company 39 C. Organizational Structure 40 D. Property, Plants and Equipment 130 ITEM 4A. Unresolved Staff Comments 130 ITEM 5. Operating and Financial Review and Prospects 130 A. Operating Results 145 B. Liquidity and Capital Resources 150 C. Research and Development, Patents and Licenses, Etc. 160 D. Trend Information 161 E. Critical Accounting Estimates 162 F. Disclosure of Registrant's Action to Recover Erroneously Awarded Compensation 162 ITEM 6. Directors, Senior Management and Employees 163 A. Directors and Senior Management 163 B. Compensation 165 C. Board Practices 166 D. Employees 168 E. Share Ownership 169 ITEM 7. Major Shareholders and Related Party Transactions 170 A. Major Shareholders 170 B. Related Party Transactions 171 C. Interests of Experts and Counsel 171 ITEM 8. Financial Information 171 A. Consolidated Statements and Other Financial Information 171 B. Significant Changes 171 ITEM 9. The Offer and Listing 171 A. Offer and Listing Details 171 B. Plan of Distribution 171 C. Markets 171 D. Selling Shareholders 171 E.

Dilution

Dilution 171 F. Expenses of the Issue 171 ITEM 10. Additional Information 172 A. Share Capital 172 B. Constitution 172 C. Material Contracts 183 D. Exchange Controls 183 E. Taxation 183 F. Dividends and Paying Agents 190 G. 190 H. Documents on Display 190 I. Subsidiary Information 190 J. Annual Report to Security Holder 191 i ITEM 11.

Quantitative and Qualitative Disclosures about Market Risk

Quantitative and Qualitative Disclosures about Market Risk 191 ITEM 12.

Description of Securities Other than Equity Securities

Description of Securities Other than Equity Securities 191 A. Debt Securities 191 B. Warrants and Rights 191 C. Other Securities 191 D. American Depositary Shares 191 PART II ITEM 13. Defaults, Dividend Arrearages and Delinquencies 192 ITEM 14. Material Modifications to the Rights of Security Holders and Use of Proceeds 192 ITEM 15.

Controls and Procedures

Controls and Procedures 192 ITEM 16. RESERVED 193 ITEM 16A. Audit Committee Financial Expert 193 ITEM 16B. Code of Ethics 193 ITEM 16C. Principal Accountant Fees and Services 193 ITEM 16D. Exemptions from the Listing Standards for Audit Committees 194 ITEM 16E. Purchases of Equity Securities by the Issuer and Affiliated Purchasers 194 ITEM 16F. Change in Registrant's Certifying Accountant 194 ITEM 16G. Corporate Governance 194 ITEM 16H. Mine Safety Disclosure 194 ITEM 16I. Disclosure Regarding Foreign Jurisdictions that Prevent Inspection 194 ITEM 16J. Insider Trading Policies 195 ITEM 16K. Cybersecurity 195 ITEM 17.

Financial Statements

Financial Statements 195 ITEM 18.

Financial Statements

Financial Statements 195 ITEM 19. Exhibits 196 ii INTRODUCTION AND USE OF CERTAIN TERMS We have prepared this annual report using a number of conventions, which you should consider when reading the information contained herein. In this annual report, the "Company," "we," "us" and "our" shall refer to Kenon Holdings Ltd., or Kenon, and each of our subsidiaries and associated companies, collectively, as the context may require. This annual report uses the following conventions: "Ansonia" means Ansonia Holdings Singapore B.V., which owns approximately 62% of the outstanding shares of Kenon; "Chery" means Chery Automobile Co. Ltd., a shareholder of Qoros; "CPV" means CPV Power Holdings LP, Competitive Power Ventures Inc. and CPV Renewable Energy Company Inc., a business engaged in the development, construction and management of power plants running conventional energy (powered by natural gas) in the United of approximately 70.69%; "CPV Renewables" is CPV Renewable Power LLC, a limited liability company through which CPV's renewable energy activity is held and which is 66.7% owned by CPV Group; "CPV Group" means CPV Group LP and its investees; "IC Power" means IC Power Ltd., formerly IC Power Pte. Ltd, a Singaporean company and a wholly-owned subsidiary of Kenon; "Inkia" means Inkia Energy Limited, a Bermuda corporation, which was a wholly-owned subsidiary of IC Power. In December 2017, Inkia sold all of its Latin American and Caribbean businesses and has since been wound up; "Inkia Business" means Inkia's Latin American and Caribbean power generation and distribution businesses, which were sold in December 2017; "Majority Qoros Shareholder" means the China-based investor related to Shenzhen Baoneng Investment Group Co., Ltd. ("Baoneng Group") which owns 63% of Qoros; "OPC" means OPC Energy Ltd., an owner, deve

FORWARD-LOOKING STATEMENTS

FORWARD-LOOKING STATEMENTS This annual report contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934 (the "Exchange Act"). These forward-looking statements include statements relating to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts and include statements contained in the sections entitled " Item 4 Information on the Company " and " Item 5 Operating and Financial Review and Prospects ." These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. Some of these forward-looking statements can be identified by terms and phrases such as "anticipate," "should," "likely," "foresee," "believe," "estimate," "expect," "intend," "continue," "could," "may," "plan," "project," "predict," "will," and similar expressions. These forward-looking statements include statements relating to: our goals and strategies; the strategies, business plans and funding requirements of our businesses; expected trends and projections in the industries and markets in which our businesses operate; our tax status and treatment and expected status and treatment under relevant regulations; our share repurchase plan; our treasury activities; critical accounting estimates and the expected effect of new accounting standards on Kenon; with respect to OPC : OPC's strategies, with respect to Israel and the United States; the expected cost and timing of commencement and completion of construction and development projects and projects under development, as well as the anticipated installed capacities and other attributes and expected performance of such projects, including the required license and approvals for the development of and financing for projects; expected macroeconomic trends in Israel and the U.S.,

View Full Filing

View this 20-F filing on SEC EDGAR