The Kika furniture store in Netanya has closed down. Most of the 250 unpaid employees in Israel of the Austrian chain rallied this morning in the car park outside the store after management told them yesterday that they would not be allowed to enter the branch this morning.
Ashtrom, which holds 15% of Kika's shares, is expected to write off NIS 26 million in its financial report. The amount written off by Ashtrom will reach nearly NIS 50 million after it wrote off NIS 20 million on its Kika investment last December.
Kika is expected to request a stay-of-proceedings today.
Kika has blamed the banks for its plight. One of Kika's shareholders told "Globes," "The banks have pulled the rug out from under our feet even though out debt is not large."
Both Bank Leumi (TASE: LUMI) abd Bank Hapoalim (LSE: BKHD; TASE: POLI) declined to comment.
During the day suppliers trucks drew up outside the Kika store and loaded up good that they had not been paid for.
Published by Globes, Israel business news - www.globes-online.com - on May 10, 2012
© Copyright of Globes Publisher Itonut (1983) Ltd. 2012