Sources inform ''Globes'' that Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY) is considering becoming a partner in department store chain New Hamashbir Lazarchan Ltd. The parties began negotiations a few weeks ago. Hamashbir owner Rami Shavit is assuming the company value of $30 million for the purpose of the deal.
Hamashbir has stores in malls owned by Africa-Israel, and also sells Gottex swimwear made by Africa-Israel subsidiary Gottex Models Ltd. Africa-Israel subsidiary Packer Steels and Metals Ltd. (Packer Plada) (TASE:PKER) sells steel to Shiryonit Hosem Security Products Manufacturing Ltd., owned by Shavit.
Africa-Israel also owns the Israeli franchise for the Zara fashion chain, which Hamashbir held when it was owned by Co-Op Blue Square Consumer Cooperative Society (Co-Op). When Hamashbir failed to meet payment terms, Africa-Israel evicted it from the first floor of the Ramat Aviv Mall, leaving it with a store on the second floor only.
Capital market sources said Shavit was considering selling half of Hamashbir. Hamashbir had a turnover of NIS 900 million in 2005, and posted a NIS 10 million profit, its first in a long time. The nevertheless still has an equity deficit, after losing over NIS 30 million in 2004.
Shavit told “Globes” in Decemebr that he wanted to float Hamashbir on the Tel Aviv Stock Exchange (TASE) in 2007 at a company value of $100 million.
Published by Globes [online], Israel business news - www.globes.co.il - on January 12, 2006