IDB Holding Corp. Ltd. (TASE:IDBH) unit Koor Industries Ltd. (TASE:KOR) has issued a bond linked to Credit Suisse Group AG (NYSE: CS; SWX: CSGN; XETRA: CSGZ). The bond's institutional tender will be held today and the public tender will be held tomorrow.
Koor sold another bloc of Credit Suisse shares today, following sales earlier this week. Yesterday, it said that it would report a capital gain of NIS 32 million on these sales in its financial statements for the third quarter.
A number of IDB companies have held bond issues in recent weeks: holding companies IDB Development Corporation and Discount Investment Corporation (TASE: DISI), as well as Bayside Land Corp. Ltd.(Gav Yam) (TASE: BYSD1), Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL), and Shufersal Ltd. (TASE:SAE;Pink Sheets: SSLTF).
On Sunday Koor's board of management approved increasing its credit line to buy Credit Suisse shares by 20% to NIS 6 billion, using both equity and bank credit lines. The company's profit in the just over 12 months since it made its first investment in the Swiss bank is NIS 2.24 billion, including NIS 1.45 billion in the second quarter and NIS 55 million that will be reported for the third quarter.
Last March, Morgan Stanley increased its non-recourse credit line to Koor for the purchase of Credit Suisse shares to CHF 330 million.
Today and tomorrow, Koor will issue NIS 200 million in bonds, which will pay 10% of the rise in Credit Suisse's share on the New York Stock Exchange. Payments will be made every six months. The bonds will be repaid in five annual payments, beginning on March 15, 2011. Last week, Standard & Poor's Maalot Ltd. gave the bonds an A+ rating with a "Stable" outlook.
Koor's share fell 0.3% by mid-afternoon on the TASE to NIS 111.70.
Published by Globes [online], Israel business news - www.globes-online.com - on August 5, 2009
© Copyright of Globes Publisher Itonut (1983) Ltd. 2009