Nochi Dankner-controlled IDB Holding Corp. Ltd. (TASE:IDBH) unit Koor Industries Ltd. (TASE:KOR) has announced this morning that it has sold Credit Suisse Group AG (NYSE: CS; SWX: CSGN; XETRA: CSGZ) shares worth NIS 918 million over the past few days.
The company said that as of today it holds 29,700,000 shares in the Swiss bank, which were worth $900 million (NIS 3.2 billion)before the end of trading on Wall Street yesterday.
Koor said, "In light of the significant developments on financial markets, the high volatility and the sharp fall in prices on world markets, the volatility of foreign currency exchange rates, and the substantial fall in the prices of Credit Suisse's share," the company was selling shares in order to reduce the credit lines taken from Citigroup Inc. (NYSE: C) and Morgan Stanley (NYSE: MS) to buy the shares. By selling the shares, Koor has reduced its "debt to guarantees ratio" as set out in the financial covenants with the two banks.
Koor will record a loss of NIS 268 million in the third quarter for the reduction in value its investment in the Credit Suisse shares stated in the financial report for the second quarter.
Koor also reported that the lien deposited with Citigroup and Morgan Stanley amounted to NIS 1.6 billion and that the value of its holdings in Credit Suisse shares, as of last night, exceeded the net balance of its debt to the banks by NIS 1.2 billion. ,p>Koor's share price fell 2.5% in early trading today to NIS 42.15, giving a market cap of NIS 2 billion.
Published by Globes, Israel business news - www.globes-online.com - on August 10, 2011
© Copyright of Globes Publisher Itonut (1983) Ltd. 2011