Leviev mulls IKEA competition in Israel

If a deal is reached, this will be Africa-Israel's first investment since reaching its NIS 7.4 billion debt settlement.

Africa-Israel Investments Ltd. (TASE:AFIL) chairman Lev Leviev is considering becoming a partner in the kika franchise in Israel. Africa-Israel subsidiary Negev Ceramics Ltd. (TASE:NGEV) is in talks with Austria's global furniture chain kika Möbel Handelsgesellschaft mbH.

kika's Israel franchisee is Solomon Batito, who is setting up the first store in Israel in Netanya at an investment of NIS 100 million. The store is due to open within a year. The store will compete against the IKEA Israel store in the city. Bronfman Fisher Investments Ltd. hold the IKEA franchise in Israel.

kika Israel is due to open more branches in Haifa and other cities.

The talks between Negev Ceramics and kika are only preliminary, and no deal may result. However, if a deal is reached, this would be Africa-Israel's first investment since reaching its NIS 7.4 billion debt restructuring deal with bondholders and the banks.

Africa-Israel subsidiary Africa-Israel Industries Ltd. (TASE: AFID) owns 74.2% of Negev Ceramics, a manufacturer of ceramic tiles and bathroom accessories. Negev Ceramics' share price was unchanged at NIS 12.33 in morning trading, giving a market cap of NIS 164 million.

Published by Globes [online], Israel business news - www.globes-online.com - on May 4, 2010

© Copyright of Globes Publisher Itonut (1983) Ltd. 2010

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