Two weeks after Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY) announced that sales of its assets would not be enough to pay its debt, Africa-Israel CEO Izzy Cohen led a delegation of senior executives at the company's shareholders meeting in Tel Aviv today. Controlling shareholder Lev Leviev was conspicuous by his absence.
Cohen said, "We can meet our debts for 2009 and 2010. We will have a problem in 2011. We perhaps have the ability to get through 2009 and 2010. It is more difficult to realize assets and that is harming the company and diluting our capital structure. It is difficult to get credit and impossible to get credit frameworks. I would need to be a financial consultant for purchasers in order to close financially the funding. It is more and more difficult to do deals."
He added, "We have needed to stop almost all our projects except the large mall that we want to open in eight months time in Moscow and another large mall that we will open in several months in Bucharest. We have tried to reduce debt mainly in the US to reduce the company's exposure and make the company more liquid."
He revealed, "The economic crisis has hit us hard and cause a shar drop in the value of our assets. Our assets went down in value by NIS 6.5 billion in six months. We issued capital last year and the money only went straight to servicing the group's debt. As a result of the loss in value of our assets the profitability of the group's assets has fallen by NIS 10 billion over the past 18 months."
He said, "We have asked for dividends of NIS 650 million from our subsidiaries. We must develop and not only engage in paying back debts."
Published by Globes [online], Israel business news - www.globes-online.com - on September 13, 2009
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