Yuli Ofer's Ofer Brothers subsidiary Melisron Ltd. (TASE: MLSR) and its subsidiary British-Israel Investments Ltd. (TASE: BRTS) are each in talks to sell one mall to REIT 1 Ltd. (TASE:RIT1) for NIS 359 million altogether. The sales come four months after Melisron completed its takeover of British Israel from Leo Noe for NIS 1.7 billion.
British Israel is in talks to sell the Nahariya Mall for NIS 159 million, and Melisron is in talks to sell the Saviyonim Mall in Yehud for NIS 200 million. The companies are selling the properties as part of the Antitrust Authority's conditions for Melisron's takeover of British Israel. The companies have to sell four malls altogether.
Melisron books the 11,500-square meter Saviyonim Mall at a value of NIS 189 million, and generated net operating income (NOI) of NIS 15.2 million in 2010. British Israel books the 11,000-square meter Nahariya Mall at a value of NIS 156 million, and it had an NOI of NIS 20 million least year.
The negotiations are independent of each other. If REIT 1 buys the two malls, it will increase its portfolio by 20% to over NIS 1.8 billion. It will probably seek to raise capital on the capital market and loans from investment institutions to finance the deals.
Melisron's share price fell 1.2% by early afternoon to NIS 73.79, giving a market cap of NIS 1.69 billion, British Israel's share price fell 1.5% afternoon to NIS 12.32, giving a market cap of NIS 2.09 billion, and REIT 1's share price fell 1.6% to NIS 6.43, giving a market cap of NIS 582 million.
Published by Globes [online], Israel business news - www.globes-online.com - on August 3, 2011
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