Hutchison Telecommunications International Ltd. (NYSE: HTX; HKSE: 2332) representative in Israel Dan Eldar has warned Scailex Corporation (TASE: SCIX; Pink Sheets:SCIXF) bondholders that if they are not willing to take a haircut then the deal to buy back control from Ilan Ben-Dov in Orange franchisee Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) will be off.
He said, "This is a very complicated deal and there is no certainty that it will be completed or that it will be completed according to the outline agreement. All the parties at interest in the deal are contributing to its success. Hutchison fir its part is paying $125 million and postponing bond repayments due in 2014 until 2017."
Eldar added a warning, "If we don't get a response from bondholders then the deal is in danger and every bondholder must take into account the likelihood of repayment in such a case."
Eldar was asked if Hutchison will inject capital into Partner to strengthen it in the current market conditions. He said, "Partner is a good and stable company from a financial point of view."
When asked why Scailex bondholders should agree to a haircut of 30% he said that, "because of the business structure there was a need to correct the financial system of institutions through which they hold Partner."
Eldar concluded, "We never left Israel. Even after we sold our holding in Partner, the company continued to operate in Israel. We are building one of the world's largest desalination plants here. Hutchison loves to do business in Israel. In any case, Partner is a public company with a board of directors and we have not come to manage Partner. I want to remind you that we are buying Scailex and not Partner, but we absolutely see an opportunity in Israel's cellular market."
Published by Globes [online], Israel business news - www.globes-online.com - on June 5, 2012
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