Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) has a NIS 1.6 billion loan from a syndicate of Israeli banks, four days before the company will distribute a large dividend. Bezeq raised NIS 1 billion in long-term debt with an average duration of 6.2 years, and NIS 600 million in short-term debt of one year.
Bezeq added that it expects to shortly secure an additional NIS 400 million in long-term debt, also with an average duration of 6.2 years, from an institutional investor, whose name it did not disclose.
Bezeq raised half of the NIS 1.6 billion by part exercising a letter of credit obtained last February from Bank Leumi (TASE: LUMI). The amount of the letter of credit was reduced from NIS 1.5 billion to NIS 700 million.
Bezeq, controlled by Shaul Elovitch, plans to distribute a special NIS 3 billion dividend that is not from profits, but by a conditional 64% reduction in shareholders' equity. The dividend will be distributed in six installments, beginning on May 19. The special dividend is on top of the company's regular dividend distributed from its profits in the second half of 2010.
The regular dividend is NIS 1.16 billion, or NIS 0.431 per share. The first installment of the special dividend amounts to NIS 500 million, or NIS 0.185 per share. Elovitch is the main beneficiary of the dividends; he will receive NIS 52 million. B Communications Ltd. (Nasdaq:BCOM; TASE: BCOM), subsidiary of his company Eurocom Group owns 31.2% of Bezeq.
Bezeq's share price fell 0.4% by mid-afternoon to NIS 8.97, giving a market cap of NIS 24.3 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on May 15, 2011
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