Less than a week after Judge Varda Alshech told Africa-Israel Investments Ltd. (TASE:AFIL; Pink Sheets:AFIVY.PK) and its Series 9 bondholders to work toward a compromise, the sides are near a deal.

Under an Africa-Israel proposal, the bondholders of Africa-Israe's shortest-term debt would receive compensation of 20% - NIS 110 million - for their relative share of about 7% of the NIS 7.4 billion debt owed by the company. The compensation figure refers to the NIS 550 million cash payment to bondholders as part of the debt deal.

Under the debt agreement, which was accepted by 12 of the 13 series of bondholders (except for Series 9), NIS 7.4 billion par value of bond debts will be cut to about NIS 4.4 billion par value. NIS 1 billion will be reissued as 2-year notes, and NIS 3.4 billion will be issued as 16-year bonds. Bondholders will receive NIS 1.2 billion in shares of subsidiary companies, and NIS 1.4 billion in Africa Israel shares.

Published by Globes [online], Israel business news - www.globes-online.com - on December 7, 2009

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