The Israeli financial institutions that invested in private equity fund Markstone, run by Ron Lubash, have refused to transfer their share of the fund's call for a further $95 million, among other things because of the cash flow problems at bookstore chain Steimatzky, one of Markstone's portfolio companies.
The recalcitrant institutions include Clal Insurance, Menorah-Mivtachim, Harel, Phoenix, Ayalon, Meitav-Dash, and Psagot. One of the reasons for their refusal is that Markstone failed to provide details of how it intended to use the cash.
The institutions in the US, however, agreed to inject cash, and since they represent 90% of the investors in the fund, Markstone succeeded in raising most of the amount it hoped for.
Meanwhile, Markstone has paid Steimatzky's $20 million debt to Deutsche Bank, and the last lien on the bookstore chain has thus been removed.
Markstone itself owes Deutsche Bank $60 million.
Published by Globes [online], Israel business news - www.globes-online.com - on June 17, 2014
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