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Two years after it hit the road, Better Place, the electric car charging network being developed by Shai Agassi with investment from the Israel Corporation, has received the stamp of approval from one of the world's largest banks, HSBC. The investment by the giant bank is good news for Israel Corporation, which has been losing money hand over fist in the shipping business.

Better Place announced this week that it had attracted $350 million from a group of investors led by HSBC, representing the largest clean-tech investment anywhere in the world, and reflecting a post-money valuation of Better Place of about $1.25 billion. That is three times the startup's value when the Ofer brothers' Israel Corporation came on board, putting $100 million into the project during the first round of investment at a value of $1 per share.

The current financing round reflects a value of $3 per share and a yield of 200% on the Israel Corporation's initial investment.

HSBC, which is directly investing $125 million, will be joined by investment banks Morgan Stanley and Lazard. The Israel Corporation and individual members of the Ofer family will put in $94 million.

The amount that Better Place managed to raise is big even by international standards, but it also serves to dispel doubts that had been raised about Better Place. The capital was committed after HSBC examined Better Place for a year. The bank is buying a 10% stake in the business. HSBC's head of leveraged finance, Kevin Adeson, will also join the Better Place board.

The injection of funds should help Better Place - which is engaged in developing battery-charging infrastructure for cars - to widen its development activities, which would include expanding the company's activities to additional countries. The company operates primarily in Denmark, Australia, Japan and the western United States, in partnership with local parties. Company founder and CEO Shai Agassi said yesterday that HSBC's commitment to the company and the international connections that the new investors bring with them will enable Better Place to proceed in implementing the company's plans. He said the company is currently in the midst of a round of expansion into new countries where infrastructure is to be built, and the new financing will enable Better Place to move forward with plans for 2012, 2013 and beyond.

In addition to the good news which the infusion of funds provides to Better Place, it is also good news for the Israel Corporation, which has in the past year suffered heavy losses in the shipping business. The Ofer family's company has invested $100 million in Better Place over the past two years, and will put in another $74 million in the current round of financing (as a portion of the $350 million that was raised). With the new infusion of funds, the Israel Corporation's stake in Better Place will be diluted from 33% to a 30% interest, but it is still seen as a success at this time. The Israel Corporation will have invested a total of $174 million in the clean-tech company, with Ofer family members investing another $50 million in total (including $20 million in the current financing round).

Better Place chairman Idan Ofer said that when Better Place was established, he could not have imagined where the company would be after just two and a half years. He noted that then there were no car manufacturers with serious plans to manufacture an electric car, but now all of them have such plans. Agassi said the technical problems involving charging car batteries were resolved last May.