Last update - 00:00 19/09/2007
Tnuva shareholders sweating as Shamir holds up guarantees
By Amiram Cohen
A week before the sale of Tnuva to Apax-Mivtach Shamir is due to close, kibbutz and moshav financial officials are worried: Mivtach Shamir, owned by Meir Shamir, has still not presented bank guarantees for the put options granted to shareholders who chose to keep Tnuva shares.
The options enable holders to sell their shares to Mivtach Shamir at the current deal price for a period of 3 years.
Under the agreement, Mivtach Shamir is to provide the remaining shareholders with a $250 million bank guarantee to ensure the options' value. Twenty-five percent of Tnuva's shareholders announced that they would not sell their holdings on the closing date and would accept the options instead; of these, 21.9 percent are held through regional kibbutz financial corporations.
A senior source in the financial corporations said that Mivtach Shamir gave no explanation as to why provision of the guarantee is being delayed, but the corporations assume that Mivtach has encountered difficulties. "The transaction is contingent upon receipt of the guarantee," the source stressed, adding that the remaining shareholders are also entitled to review and approve the guarantee prior to the closing.
Bank Hapoalim, which is financing Mivtach Shamir in the Tnuva transaction, should issue the guarantees.
"The company is adhering to all terms of the agreement, and will present the bank guarantees, as it undertook to do in the Tnuva sale agreement, on the closing day," Mivtach Shamir stated. Agriculture sector sources say that another hurdle is that the registrar of partnerships hasn't yet approved the deal, because the investigator appointed to review the transaction hasn't finished. There is no chance of the deal closing in the coming weeks, they added.