The bidding for the acquisition of Africa-Israel Investments Ltd. (TASE:AFIL) from the company's bondholders is being extended, but the beneficiaries right now are the bondholders themselves. The two main bidders for the company, Naty Saidoff and Moti Ben-Moshe, have continued improving their bids in recent days, with an eye to tomorrow's scheduled final vote by the bondholders, after the vote was postponed from last Thursday. Africa-Israel owes NIS 3 billion to holders of its three bond series. Another possibility is the company's liquidation, followed by the separate sale of its assets. Several of Africa-Israel's major bondholders believe that much higher proceeds of NIS 2.3-2.4 billion can be obtained in this way, due to the inherent value of the company's assets.
At that time, the various bids to acquire Africa-Israel and/or its various assets were worth less than NIS 2 billion. It appears, however, that the intense competition between Ben-Moshe and Saidoff is now pushing the amount being offered closer to the economic value of the group's assets.
Ben-Moshe added NIS 25 million
Last Thursday, Ben-Moshe announced that he would increase the proceeds for the bondholders by NIS 35 million, therefore making the nominal value of his two bids NIS 2.2 billion for the cash alternative and NIS 2.26 billion for the bond alternative. In the calculation of the economic value of the two alternatives, Ben-Moshe emphasized that the value of the cash alternative had the same economic value of the bond alternative: NIS 2.245 billion. Isaac Idan, CPA, from the Baker Tilly firm, which is advising the bondholders' representatives, provided similar figures. According to the most recent document released by Idan on Thursday, the nominal value of Ben-Moshe's bond alternative is NIS 2.262 billion, while the economic value is NIS 2.221 billion. Idan assigned a NIS 2.2 billion value to the cash alternative, while emphasizing that the option of choosing it belongs to Ben-Moshe only.
At the same time, the economic advisor of the bondholders' representatives evaluated Saidoff's bid, and found that its nominal value was NIS 2.221 billion and its economic value was NIS 2.15 billion. On the other hand, Saidoff's representatives said that the value of his bid was NIS 2.249 billion, after he increased the bond element by NIS 30 million to NIS 1.45 billion, and added a cash option in order to make his offer more attractive to the bondholders.
Africa Residences raising over NIS 200 million in bonds
Africa-Israel Residences Ltd. (TASE:AFRE), in which Africa-Israel Investments owns a 74% stake, last Thursday successfully completed the preliminary stage of a new (Series D) bond issue. Africa-Israel Residences has an A2 rating from Midroog. In the auction, selected investors submitted preliminary commitments to buy NIS 202 million in bonds. The public section of the issue, in which the company will attempt to increase its proceeds to NIS 250 million, is scheduled to take place in the coming days. The bonds, which have a 5.5-year duration, are repayable in four unequal payments in 2019-2025.
Published by Globes [online], Israel Business News - www.globes-online.com - on December 17, 2017
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