Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY), controlled by chairman Lev Leviev, and Polar International Real Estate (1997) Ltd. (TASE:PLIT), controlled by Ziel Feldman's FR Holdings, lost their investment in the Hard Rock Park amusement in Myrtle Beach, South Carolina, after it was sold in bankruptcy court for $25 million.
Polar International Real Estate owned 25% of HRP Myrtle Beach Holdings LLC, the vehicle set up for the Hard Rock Park project in Marcy 2006; Africa-Israel owned 25, Feldman, and other investors owned the rest. The company also acquired a 10% interest in adjacent land for $25.4 million.
The Hard Rock Park amusement park opened with much fanfare in April 2008, but completely failed to meet its targets. The company licensed the brand name from Hard Rock International Inc. HRP filed for Chapter 11 bankruptcy protection with the US Bankruptcy Court for the District of Delaware in September 2008 after five months of operations. The court sold the company, under Chapter 7 bankruptcy, to FPI MB Entertainment Inc. for $25 million - just 7% of the investment.
Polar International Real Estate lost its $16.8 million in the project. The company posted a net loss of NIS 20 million in 2008, compared with a net profit of NIS 33 million in 2007.
Published by Globes [online], Israel business news - www.globes-online.com - on March 29, 2009
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