Yitzhak Tshuva
Tshuva seeks debt arrangement
Delek Real Estate directorate convenes Thursday to decide on debt scheme: Deferral of NIS 308 million debt repayment, debt to equity conversion, debt-asset swap, or cash injection by Tshuva
For the first time in his life, Yitzhak Tshuva might default on a debt to the bondholders of the company under his control – Delek Real Estate.
The first is an eight-month deferral on the 25-series bond repayment of NIS 308 million ($90 million), from next September to May 2012, when the company is scheduled to repay another NIS 160 million ($45 million) to its Series 4 bondholders.
Delek Real Estate's directorate will convene Thursday to decide which of the following debt schemes to adopt.
Financial Trouble
Golan Hazani, Liroy Peri
Less than two months before it has to pay bondholders NIS 340 million, company's coffers still short of most of funds. To add to its problems, it now faces demands for NIS 1.4 billion write-down in UK, appointment of receiver for its holdings in Germany
According to this scheme, the 25-series bondholders will be indemnified in the form of a higher interest rate to hold at bay any claims of a haircut if this option does indeed get the green light, chances of which are high.
The second option calls for a conversion of the 25-series debt to equity; considering that the company's market cap is a mere NIS 80 million ($25 million), this scheme has slim chances of getting the thumbs up.
The third proposal is for a debt-asset swap based in an external evaluation of the company.
The fourth alternative includes a cash injection by Tshuva coupled with one of the three aforesaid proposals. This scheme has high prospects as well. Tshuva's cash injection will probably be limited to tens of thousand of shekels; his debt to Delek Real Estate bondholders is NIS 2.4 billion ($700 million).
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