Arazim Investments Limited, the real estate company listed on the Tel-Aviv Stock Exchange (together with its subsidiaries, Arazim or the Company) announce today that it received a signed letter from a leading international investment bank (the Bank) on 6 June 2011 confirming that the Bank is highly interested in providing to Arazim, subject to certain conditions, a loan facility.
In accordance with the letter, the Company expects to raise senior debt financing of c. 140 million Israeli Shekels (c. £25.05 million) net of transaction costs from the Bank, whereas the loan would be secured by a comprehensive security package comprising the vast majority of the Company‘s assets including (a) the Capella portfolio of assets; (b) shares in its material subsidiaries (including Arazim Gibraltar); and (c) a share pledge over all shares in Arazim which are held by the Company’s controlling shareholder.
Excellion Capital is acting as financial adviser to the Company in relation to the loan.
The consummation of the loan facility is conditional, amongst other things, on the Company using the loan proceeds together with funds currently held in the Company’s accounts to successfully extinguish the bondholder debt in its entirety.
The Company also announced today its proposal for a settlement offer (the Settlement), pursuant to which the Company would, subject to the consummation of the loan facility, pay to its major creditors (this being all of its bondholders as well as the Israeli tax authority) a cash amount of 250 million Israeli Shekels to repay and extinguish all of the Company’s liabilities vis-à-vis these creditors. Simultaneously the Settlement envisages the shares of Arazim being de-listed from the Tel-Aviv Stock Exchange such that the Company would, upon the Settlement becoming effective, cease to be publicly listed.
Arazim‘s assets are predominantly commercial real estate concentrated with assets in the UK and Germany.
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