Sources inform ''Globes'' that Ace Auto Depot Ltd. (TASE:ACDP) will likely fire 100 of its 1,350 employees as part of a recovery effort by the struggling retailer. The company will probably also close loss-making stores. Ace currently operates 36 ACE DIY stores, one Hyper Rosenfeld store, and 18 Ace Auto Depot stores, 11 of which operate as part of Ace DIY stores.
Ace is already in talks to transfer its Ra'anana store to independent supermarket chain Kol-Bo Kimat Hinam Ltd., and apparently also wants to close its stores in Rishon LeZion and Maalot. The Rishon LeZion store is on land owned by Shufersal Ltd. (TASE:SAE), which may hinder a transfer to the supermarket chain. On the other hand, the Rishon LeZion and Maalot are small stores that should not affect Ace's turnover.
Ace lost NIS 25 million in the third quarter and NIS 40 million in January-September, after losing NIS 62 million in 2010. Third quarter revenue fell 7.5% from the corresponding quarter to NIS 204 million in the third quarter. The company announced a recovery plan, which it said would be felt in 2012.
Ace's currently liabilities total NIS 329 million, mostly owed to suppliers and service providers, and it has NIS 47 million in cash and investments. Its shareholders' equity deficit is NIS 18.3 million. Its controlling shareholders, B. Gaon Holdings Ltd. (TASE: GAON) and Shlomo Zbeda will give it a NIS 20 million owners loan in equal shares. The company has also reached a settlement with the banks in exchange for the recovery plan.
Ace's share price was unchanged today at NIS 1.47, giving a market cap of NIS 16 million.
Published by Globes [online], Israel business news - www.globes-online.com - on December 7, 2011
© Copyright of Globes Publisher Itonut (1983) Ltd. 2011