AFI Development plc (LSE:AFID), the Russian development arm of Lev Leviev-controlled Africa-Israel Investments Ltd. (TASE:AFIL) is finding it difficult to close the sale a property in Moscow to a Cypriot company for $195 million, the Russian media reports.
AFI Development wants to sell the 112,000-square meter Kosinskaya Plaza business and retail center, on Kosinskaya Street, near the Vykhino metro station to Cypriot Bedhunt Ltd., which undertook to close the deal and transfer payment by August 20, 2010, but has transferred only $73 million to date.
Bedhunt plans to build a mall on the site, but reportedly has not been able to obtain a building permit, and it therefore wants to cancel the deal. It has sued AFI Development in a Nicosia court to refund the money already transferred, plus $2.5 million in interest per month until the case is closed.
Russian media sources report that AFI Development bought the Kosinskaya Plaza office for $243 million in 2007.
AFI Development's share price fell 0.2% in morning trading in London to $1.22, giving a market cap of ₤830 million, and Africa-Israel's share price fell 1.4% by early afternoon to NIS 28.59, giving a market cap of NIS 3.05 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on March 1, 2011
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