More foreign banks demand Delek immediately repay debt

Yitzhak Tshuva

Two banks that lent Delek Group $200 million and €50 million are demanding immediate repayment.

Following the market upheaval that has driven down the share price of Delek Group Ltd. (TASE: DLEKG) and put its bond yield into the junk bond category, and the demand by Citibank for repayment of Delek Group's debts, other banks are now making the same demand of Delek Group, controlled by Yitzhak Tshuva.

The company reported today that other banks were demanding immediate repayment of the debt to them because of the financial conditions in the loan agreements. Delek Group has so far repaid $43 million of a $200 million loan from a foreign bank. Under the loan agreement, the bank is entitled to demand immediate repayment of the debt if the value of a basket of companies similar to Ithaca, a Delek Group subsidiary, falls by over 50%, and the Delek Group's share price and the FTSE index also each fall by more than 50%.

Another foreign bank is demanded repayment of a €50 million loan granted in August 2019 and due for repayment in 2022. The grounds for the demand are insolvency in a different loan - the loan that Citibank is now demanding that Delek Group repay. Repayment of this loan is being delayed by a temporary court order.

Delek Group says that as of yesterday, its short-term credit and loans, together with those of Delek Energy, amount to NIS 923 million. Delek Group and Delek Energy attached Delek Drilling partnership units and shares in Cohen Development Gas & Oil worth NIS 7.1 billion in order to secure this credit.

Delek Group says that it also possesses "NIS 110 million in cash balances and marketable securities worth NIS 150 million that can be sold on short notice. In addition, the company is due to receive proceeds totaling NIS 164 million from the sale of its holding in IDE Technologies."

Delek Group is delaying publication of its financial statement, and is currently holding talks with its creditors.

Published by Globes, Israel business news - en.globes.co.il - on March 23, 2020

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

Yitzhak Tshuva
Yitzhak Tshuva
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