The owners of the Eilat Princess Hotel and Bank Leumi (TASE: LUMI) representatives have reached a settlement that will allow the hotel to remain in business.

Yesterday, Bank Leumi and Lexan Israel Ltd., the owner of the Eilat Princess Hotel, which owes the bank NIS 250 million, filed a request for approval of a settlement between the parties with Tel Aviv District Court Judge Eitan Orenstein. Under the settlement, Lexan will pay the bank NIS 148 million in cash, and the balance of the company's debt will be repaid in future annual payments.

The parties are requesting that the court give the settlement the force of a court ruling. The settlement represents a significant achievement for Bank Leumi, which is expected to successfully collect the full amount of Lexan's debt.

The Eilat Princess Hotel is one of the best known hotels in the southern city. It is located on Eilat's southern coast, where the desert meets the Edom mountain range and the Coral Beach Nature Preserve. The hotel has 419 rooms, 64 of which are luxury suites.

Published by Globes [online], Israel business news - www.globes-online.com - on July 4, 2011

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