A new front has opened up in the strife over Scorpio Real Estate Ltd. (TASE: SCRP.B1): the bondholders versus Bank Hapoalim (TASE: POLI). The bondholders representative body claims that Scorpio, controlled by Beny Steinmetz, has succumbed to pressure exerted by Bank Hapoalim to prefer the bank over other creditors.
"Hapoalim is putting pressure on Steinmetz via other companies he owns, and forcing him to prefer the debt to the bank over the debt to the bondholders. Bank Hapoalim is acting in an ugly, aggressive, and bullying manner," a manager of a large institution on the bondholders' representative body said.
This evening, Adv. Gil Oren of Yigal Arnon & Co., who is eh attorney for the bondholders, sent an official letter to Scorpio CEO Shimon Menachem, demanding immediate repayment of NIS 122 million (a bond that has reached maturity amounting to NIS 103 million plus NIS 19 million interest). "Unless you do so, we will demand immediate repayment of the entire debt, and submit to the court a request or liquidation," Oren threatened. He warned against any attempt to prefer another creditor, including Bank Hapoalim.
Scorpio owes NIS 571 million to its bondholders and another NIS 355 million to Bank Hapoalim. Steinmetz has proposed injecting $100 million into Scorpio, to be transferred immediately to the bondholders, while Bank Hapoalim will receive his personal guarantee for $100 million.. The debt to the bank will be rescheduled, and a small part repaid in cash. The rest of the money Scorpio owes the bondholders, some $50 million, will be spread out until 2019, so that there could be a haircut amounting to a third of the debt.
Published by Globes [online], Israel business news - www.globes-online.com - on May 30, 2010
© Copyright of Globes Publisher Itonut (1983) Ltd. 2010