Israel Corporation (TASE: ILCO) today postponed the general shareholders meeting, scheduled for Wednesday, which was due to discuss the debt settlement for wholly-owned subsidiary Zim Integrated Shipping Services Ltd. The meeting has been rescheduled for October 28, with no change in the agenda.
In its notice to the Tel Aviv Stock Exchange (TASE), Israel Corp. said, "Zim was given the opportunity to complete the arrangements for the recovery plan agreed with the various parties, which would enable the company to make a supplementary notification of additional details relating to the settlements formulated in the framework of the agreed recovery plan." In other words, Zim and its creditors cannot strike a deal.
Zim is negotiating with its various creditors, including foreign and Israeli banks, its bondholders, and ship and container leasing companies. Zim's debt is $3.6 billion, not including $100 million in liabilities for employees' rights. The debt is due to fall to $430 million from 2014. It owes Israeli bondholders $350 million.
Israel Corp.'s controlling shareholder, Ofer Holdings Group, owned by the Ofer family, is not just asking Zim's creditors for assistance; it is ready to inject $350 million of its own into Zim, of which $100 million has already been approved. An additional $250 million is waiting for approval.
In early October, Israel Corp. notified the TASE that, in view of Zim's current cash flow, Israel Corp. was asking its affiliates to bring forward $17 million in payments to the company. The responses were favorable.
Israel Corp.'s share rose 1.6% in morning trading to NIS 2,522.
Published by Globes [online], Israel business news - www.globes-online.com - on October 12, 2009
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