Ashtrom Group subsidiary Ashtrom Properties Ltd. (TASE:ASPR) is entering the furniture business and going head to head against IKEA Israel. After prolonged negotiations, the company has signed a partnership agreement with Austrian furniture retailer KIKA, at a value of NIS 74.2 million.
Ashtrom Properties has been allotted 15% of KIKA Israel, which does not yet have any significant activity, by G. Solomon Investments Ltd., owned by Solomon Batito. In exchange, Ashtrom has promised a NIS 11.13 million owners' loan, half of which it has already made available to KIKA Israel.
This is Ashtrom Properties' first retail venture.
KIKA is an Austrian furniture brand that is considered a direct rival of Sweden's IKEA. KIKA has scores of stores in Austria and Eastern Europe, and it will begin operations in Israel in the first half of 2011. KIKA's stores cover 15,000 square meters, and it offers one-stop-shopping for furniture and homewares.
Published by Globes [online], Israel business news - www.globes-online.com - on August 15, 2010
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