The trustees of the ailing DIY supplier Ace Auto Depot asked a court on Monday to accept a NIS 120 million takeover bid by Electra Consumer Products.
The offer for the company, which runs the Ace do-it-yourself stores, includes NIS 40 million cash and NIS 80 million in inventory.
Electra - owner and operator of Shekem Electric, Big Sensor and Electrical Warehouses (Makhsanei Hashmal ) - committed to retaining 75% to 80% of Ace employees. The deal still needs the approval of the antitrust commissioner.
Publicly-traded Ace Auto Depot has outstanding debt of NIS 144 million, and its wholly-owned Ace retail chain owes an additional NIS 308 million. Electra's offer includes NIS 12 million in cash up front and NIS 4.5 million per month in cash and inventory over two years. The inventory component will partly defray sums owed to Ace suppliers.
The chain's debts include NIS 64 million owed to three banks - Bank Leumi, Bank Hapoalim and the First International Bank of Israel - all of which is secured. It also owes employees NIS 15.5 million, while other creditors, including its unsecured suppliers, are owed NIS 200.5 million. The parent company's debts also include NIS 83 million to bondholders.
Several assets that wouldn't be included in the Electra deal could add several tens of millions of shekels to the kitty for creditors. The company's stock market shell, for instance, might go for a few million, as would several smaller businesses not part of the company's core operations.
The trustees, Amir Palmer and Boaz Gazit, said a promise by controlling owners Shlomo Zveida and Gaon Holdings to lend the company NIS 20 million by January 31 hasn't been carried out and is still under consideration.
Meanwhile, a group of 22 suppliers - unsecured creditors owed a total of NIS 30 million by the chain - have petitioned the court to order the three banks to exercise their rights to NIS 18 million in guarantees pledged by Gaon and Zveida last July.
The three each received NIS 6 million in guarantees by the owners after the company failed to meet its bank-loan covenants. Gaon and Zveida provided the guarantees so that the banks would not demand immediate repayment of their loans.
