Subscribe to Print Edition | Sun., December 14, 2008 Kislev 17, 5769 | | Israel Time: 01:51 (EST+7)   Back to Homepage web haaretz.com Haaretz Toolbar Diplomacy Defense Jewish World Opinion National Print Edition Car Rental Books Haaretz Magazine Business Real Estate GA 2008 Travel Week's End Anglo File

Shlomo Nass stands his ground: Yuli won't repay its bonds early By Sarit Menahem Bondholders of Yuli Capital Markets arrived at the Wednesday assembly upset but clear in mind: no new deals, no new partners and definitely no adventures in eastern Europe. They wanted their money back, right away. The meeting had been called by Shlomo Nass and Henry Kauftheil, Yuli's controlling shareholders, to tell the bondholders about a deal to sell control over to a company called Mavestinio Limited. Advertisement Mavestinio, registered in Cyprus, belongs to two former Israelis living in Australia, Moshe Meydan and Nathan Stoliar. The company owns property in the Polish cities of Poznan and Lodz. Mavestinio would buy 83% of Yuli in exchange for 27% to 35% of its own shares, depending on an appraisal of the Polish properties, Nass and Kauftheil said. Yuli had raised more than NIS 100 million from bondholders. The money is sitting there in its bank account, since the company doesn't do anything and has no assets. After buying Yuli, the Australian-Israelis would use its money for projects in the pipeline. But the bondholders suspect that the risk of not getting their money back would increase. "The deal we're looking at today is the best offer we've had," said Nass, a soft-spoken man. "We've had more than 70 offers. People have told us, take money, cash, and give us the company. But we aren't taking money and leaving, we're staying with the company. I know that people invested in the company because of us. We're staying out of faith. People who say we took money don't know what they're talking about." He will remain chairman, Nass continued, and isn't taking one single shekel home. "Every shekel we raised will be returned at the terms we undertook," he said. "People are besmirching a deal they don't know." Possibly, but the bondholders were unmoved and know what they wanted: their money back. They complimented Nass et al for having had the good sense not to get into yield-generating property in the United States, and were even willing to settle for part of their money at this stage. But their message was absolute: Money back or a fight, tooth and claw. Unpersuaded by Nass, the bondholder meeting deteriorated. "You are raping us. We'll fight back," came from the representative of an institutional investor. "Pay attention to us. We aren't dirt to be trampled on. Respect us. Give us at least some of the money back at an adjusted price. Don't take it onto a new adventure lasting years assuming we're idiots. We aren't. You're wealthy anyway and the time of gambling at our expense is over." Nass was hurt. "I'm not raping anybody, not trampling on anybody," he answered. "I don't understand how you can talk to me this way. You don't get up in the morning and read these names you're called in the paper." The representative apologized but it was clear that he and the other bondholders had a bellyful and didn't like the deal with Mavestinio. Since it was announced two weeks before, Yuli bonds dropped 17% in price to a yield of 42%, which indicates deep disquiet about repayment. Yuli has the cash to repay, NIS 102 million just sitting there, and has shareholders equity of NIS 5.5 million. It has the wherewithal to cover its liabilities after buying back its bonds. The question is one of intent. Nass described the advantages of the Mavestinio takeover and the new partners, ex-Israelis living in Australia with worldwide operations in computers, textiles and real estate. The bondholders could meet with them soon, when they visit Israel. "The proposal to redeem the bonds isn't relevant," Nass said. "This is a company, it has shareholders and it's impossible. It isn't my company. I don't control it. Redeeming the bonds prematurely for no reason would expose me to lawsuits by the shareholders." But the bondholders wanted no new investments in eastern Europe, and Nass refused to give the bondholders a right to veto the Mavestinio takeover. The meeting with bondholders did not end with a meeting of the minds. The controlling shareholders were firm and the institutional investors threaten to sue. Stay tuned. Bookmark to del.icio.us   Time to talk Israeli and Palestinian leaders set the terms to discuss 'two states for two peoples.' The Wall Street fraud Bernard Madoff's $50 billion fraud threatens Jewish philanthropy.

Read & React Iran irate after Sarkozy rules out shaking Ahmadinejad's hand Responses: 176 Palestinians: Israel asked to annex 6.8% of West Bank Responses: 106 IDF soldiers critically wound Palestinian youth with rubber-coated bullet Responses: 94 Livni: It isn't possible to bring every soldier home Responses: 66 Carter discusses Mideast peace prospects with Assad in Syria Responses: 70 U.S. Army sends American-Israeli woman to Afghanistan Responses: 94 More Headlines 22:38 UN set to adopt resolution urging Israel, Palestinians to continue talks 18:00 Barak: Shalit is one of the reasons to refrain from launching Gaza offensive 22:54 Madoff Wall Street fraud threatens Jewish philanthropy 21:33 Carter, in Damascus, predicts improved U.S.-Syria ties under Obama 18:07 In Gulf meet, Gates warns U.S. opponents: Don't test Obama 17:45 Iran: We have proof U.S. and Britain support terror group 21:07 Top Defense Min. official heads to Cairo to discuss Gaza truce 00:59 Ben-Gurion International Airport to launch first gym in Terminal 3 23:11 Palestinians: Israel asked to annex 6.8% of West Bank 00:02 Israeli author Amos Oz: Arab-Israeli conflict kept alive be fanatics 11:27 Rice: Bush not done working on Israeli-Palestinian issue 07:47 IDF soldiers critically wound Palestinian youth with rubber-coated bullet 12:59 Report: Group attacks Saudi airline office in Iran to protest Saudi peace plan 06:12 Egyptian guards kill African man trying to cross into Israel 17:16 Ahmadinejad: Israel at end of line, will soon fade away 13:28 Amira Hass returns to Gaza after a two-year absence Previous Editions Select Day 12 dec 11 dec 10 dec 09 dec 08 dec 07 dec 05 dec 04 dec 03 dec 02 dec 01 dec 30 nov

Special Offers Advertisement Summer in Israel Israeli style - Tzofim Chetz V'Keshet 2009 Living in Israel Studying in English Click & Meet our students from all around the world Fattal Hotel Chain Perfectly located hotels on best resorts of Israel. Car rental in Israel Shlomo Sixt Receive $15.00 from our low rates. Eldan Rent a Car Israel's leading car rental company offers you a 20% discount on all online reservations Jewish Singles Personal Ads Find the love of your life on JDate.com Hebrew Summer courses From $39.95 Junkyard Junk a car - get free towing nationwide and a tax-deductible receipt

Home | TV | Print Edition | Diplomacy | Opinion | Arts & Leisure | Sports | Jewish World | Underground | Site rules |

Real Estate in Israel | Travel to Israel with Haaretz | Hotels Israel | Restaurants Israel | Tourist attractions Israel | Shops Israel

birthright Israel | Search engine marketing

Haaretz.com, the online edition of Haaretz Newspaper in Israel, offers real-time breaking news, opinions and analysis from Israel and the Middle East. Haaretz.com provides extensive and in-depth coverage of Israel, the Jewish World and the Middle East, including defense, diplomacy, the Arab-Israeli conflict, the peace process, Israeli politics, Jerusalem affairs, international relations, Iran, Iraq, Syria, Lebanon, the Palestinian Authority, the West Bank and the Gaza Strip, the Israeli business world and Jewish life in Israel and the Diaspora.

© Copyright  Haaretz. All rights reserved