Court prevents Leumi from seizing Delek assets

Yithak Tshuva / Photo: Yossi Cohen

Tel Aviv District Court Judge Hagai Brenner has issued a temporary injunction preventing Bank Leumi from realizing its lien on Delek Drilling partnership units.

In response to a request by Delek Group Ltd. (TASE: DLEKG) unit Delek Energy, Tel Aviv District Court Judge Hagai Brenner has issued a temporary injunction preventing Bank Leumi (TASE: LUMI) from realizing its lien on the assets of Delek Drilling LP (TASE: DEDR.L).

The request was submitted to the court on behalf of Delek Energy by Advs. Pinhas Rubin, Yaron Elhawi and Amnon Biss of Gornitzky & Co. law firm.

The request was filed following Bank Leumi's announcement on Monday that it planned selling the Delek Drilling partnership units on which it has a lien after Delek Group apparently did not keep an agreement with the bank from March 24.

The request to the court claimed that the order was necessary to prevent the sell by Bank Leumi, which is not in accordance with the law.

Judge Brenner has given Bank Leumi until May 6 to respond to Delek's request and set May 10 as a date for a hearing on the matter.

The court papers say that Delek Energy has a debt of about NIS 100 million to Bank Leumi. The value of the Delek Drilling partnership units on which the bank has a lien is about NIS 300 million, while when the credit agreement was signed with the bank the 'contractual' ratio between the tradeable value of the securities and the debt was only 2.5.

Delek Group says that according to the credit agreement, while the ratio of the securities is above 1.85, Bank Leumi is not entitled to demand redemption of the debt.

Delek Group, controlled by Yitzhak Tshuuva, has a debt of NIS 6 billion to bondholders and more than NIS 2 billion to various banks.

Published by Globes, Israel business news - www.globes-online.com - on April 30, 2020

© Copyright of Globes Publisher Itonut (1983) Ltd. 2020

Yithak Tshuva / Photo: Yossi Cohen
Yithak Tshuva / Photo: Yossi Cohen
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