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Rogosin controlling shareholder Ezra Harel sold his 42.6 percent stake in the real estate investment company to U.S. businessman Yochi Schneider. Harel will provide NIS 18 million guarantees for bondholders and banks, contingent on a creditors' agreement. Harel will receive $100,000 in cash for his shares, as well as a five-year promissory note for $2.75 million that carries 2 percent annual interest, also contingent on a creditors agreement .

Rogosin had been slated to repay 25 percent of the bond debt, NIS 18 million, this morning. The board of directors will be replaced instead and Schneider will approach major bondholders.

Most major bondholders apparently purchased the bonds at the recently prevailing low prices, rendering a compromise likely.

Schneider said his investigation indicated Rogosin had encountered cash flow problems due to lack of correlation between investment and debs. According to him, most of the company's investments are long-term, while its debt is repayable on given dates.

"It appears a hasty sale of assets under current market condition, is not in anyone's best interests."

Harel said the decision to provide financing and transfer control to Schneider for future consideration was designed to enable the company's rapid rehabilitation.

Harel's risk in the event no creditors agreement is reached is minimal, as he then will not provide the guarantees and will only give up control in the company. His risk increases if an agreement is reached, but hecould nonetheless post capital gains when he cashes in the promissory note. Schneider's risk is also low as his expenses will not exceed the $100,000 he paid Harel upon signing the agreement, even if the company is liquidated of liquidation also would not be great.