Delek Glbl Share Discussion Threads

[kenny] 02/12/2011 16:36

Quarterly accounts to 30.09.11 are now available on request from the company. Quite a mess as the derivatives have taken a big dive in value in the quarter so NAV is down to 48p.

I reckon the subsequent 3rd buyback takes NAV down to 45p. However, once a property in Germany is sold they will be able to walk away from the negative debt and this will boost the balance sheet by £30m and NAV will go to 64p (note 9a). Following turbulence in the bond market in August and September there has been a subsequent recovery so the derivative 'liability' will likely improve by year end.

I also estimate that net income going forward will be sufficient to support dividends of 3p per quarter. The company recently issued documentation to authorise further buybacks to occur during 2012 but what they have to sell to produce a material sum (outside of NCP) is not clear to me. They are in negotiations with the operators of NCP which may lead to a reduction in rents but, on the plus side, some properties may be handed back and some or all of those have development value. Those properties could either be developed by DGRE or, more likely, sold to developers.

In summary, unless they need to use income to support loan redemptions, the dividends are going to be substantial. As regards buybacks, this seems unclear, as does the ever fluctuating NAV. Because remaining equity is now such a small percentage of gross assets, the NAV will likely swing up and down by large amounts in the future. For this reason, I think that NAV has almost become irrelevant - it is the actual values achieved on liquidation of assets that is the acid test; as clearly DGRE will need to be liquidated over coming years to meet the terms of the agreement currently being negotiated with DRE's bondholders.

[kenny] 30/11/2011 10:09

Class action by DRE holders, does not involve DGRE but does involve over-valuation of DGRE assets. Seems without merit and based on hindsight.
=======================================================================
Investors file NIS 720m class action against Delek Real Estate
'The company's officers made fraudulent entries in the company's financial statements and reports while the company's board members turned a blind eye and exhibited gross negligence,' wrote Renan Gersht.
By Sivan Aizescu Published 04:47 30.11.11

The Tel Aviv District Court has been asked to allow a NIS 720-million class action filed by attorney Renan Gersht against Yitzhak Tshuva, Ilik Rozanski, and current and past Delek Real Estate board members. Gersht, who himself owns stock in Delek Real Estate, submitted the claim for damages allegedly suffered by the company's shareholders. It has no direct connection to the company's emerging debt settlement with its bondholders.
"The company's officers made fraudulent entries in the company's financial statements and reports while the company's board members turned a blind eye and exhibited gross negligence," writes Gersht in his brief. "The controlling owner and board members not only failed to prevent the application and presentation of the misleading information but used it as a basis to distribute dividends and perform interested party transactions.

"If that wasn't enough, as a result of these deliberately fraudulent actions that caused public shareholders monetary losses, shareholders had to absorb losses due to salaries and bonuses paid to company officers in light of the 'performance' they displayed," Gersht adds.

The main argument in Gersht's suit concerns suspicions investigated by the Israel Securities Authority of alleged deceptions in the financial statements. The ISA transferred its material to the State Prosecutor's Office, where an indictment remains pending.
"In August 2010 the ISA announced that, according to its findings, Rozanski, then CEO of the company, committed grave securities offenses through false representations and deceptions to the public, the ISA, and the company's auditors," Gersht notes. "According to the ISA's findings and its announcement, increases to the company's value were performed through false entries in the financial statements and valuations published by the company in an attempt to 'create' a high fallacious value for the company. Some of the fraudulent activities began (at the latest ) in November 2008, according to the findings." Gersht goes on to claim that "the exposure of the true situation led to the collapse in the company's value."

Tshuva's 'straw men'

Beyond this main argument, Gersht raises a series of grievances about Delek Real Estate's conduct over the years which, he claims, resulted in company shareholders sustaining losses.
Tshuva is named as the first defendant in the suit despite not serving in any capacity in the public companies under his control. "By virtue of his control over the company, Tshuva appointed some of the board members as directors on his behalf, and it was he who steered, and is steering, the company," Gersht explains. "This includes the use of straw men and those operating on his behalf in deference to his authority, while breaching and neglecting their duties toward shareholders and the company.
"The first indication of the controlling owner's involvement is seen from the decision to separate the company's business from the business of Delek Group," the charges claim. In October 2008, Tshuva's Delek Group announced its intention to distribute ownership shares in Delek Real Estate to its shareholders as a dividend in kind. Gersht claims that the move "allowed Tshuva to separate the 'burdensome' asset of the company's capital (Delek Real Estate ) from the 'profitable' asset from which dividends could be distributed (Delek Group )."

Gersht says that, since the separation between the two companies, Delek Group has distributed NIS 1.8 billion in dividends, mostly to Tshuva who owns 65% of its shares.
"There can't be any doubt that the officers and controlling owner, who operated behind the scenes to carry out the structural separation, knew that Delek Real Estate was in terrible condition," writes Gersht. "They acted to remove it so it wouldn't impair the profitability of the parent company, the controlling owner's cash cow - sustaining him through the enormous previously described dividends, and also providing a solution for the neglected state of Delek Real Estate and its investments by letting it fall."
Tshuva's involvement in Delek Real Estate is also expressed in the company's dealings with his family, other companies under his control, and meetings with institutions, the charges add.
The class action request was submitted through attorney Ophir Naor, Gersht's legal partner. The plaintiff intends to request funding for the process from the ISA under its procedure for the funding of class actions.
"An injustice has been done, not just to the company's creditors but also to its shareholders," Naor told TheMarker on Monday. "The loss of shareholder value is the damage. This doesn't prejudice the rights of creditors to settle with the company and stand up for their rights. I hope they also choose to act and won't be satisfied with just trying to generate public pressure."
Rozanski said he hadn't yet received notice of the suit and therefore chooses not to respond at this stage. No response was received from Tshuva before this article was published.

[kenny] 22/11/2011 15:14

duplicate posting, ignore.

[kenny] 22/11/2011 11:31

Mr T losing his reputation as well as a pile of money:

Bottom shekel / Tshuva sacrifices his honor
In the end, Tshuva recognized the dismal situation and recruited Prof. Amir Barnea to officially undertake a debt settlement that would involve a 'haircut' of at least 30-50%.
By Michael Rochvarger Published 04:52 22.11.11

For the past three years, Yitzhak Tshuva has been lulling investors to sleep with the illusion that things with Delek Real Estate will work out. He also sedated himself by ignoring the company's precarious situation, evidenced daily in the stock listings. He must have believed he'd get lucky again, just like when he struck a bonanza of natural gas at the height of the 2008-2009 crisis.

In the end, Tshuva recognized the dismal situation and recruited Prof. Amir Barnea to officially undertake a debt settlement that would involve a "haircut" of at least 30-50%. It's not that he didn't, now and then, make an effort: Tshuva initiated a series of actions with the objective of saving Delek Real Estate, while at the same time severing the failing company's ties to Delek Group, his most important asset.

Tshuva pulled Delek Real Estate out of Delek Group and, through Delek Group, bought Roadchef from Delek Real Estate. Meanwhile, The Phoenix Holdings, under his control, kept putting off deadlines for repayment of loans it extended to Delek Real Estate. In addition, Delek Israel was ready to buy Delek Real Estate's land and retail properties.

It wasn't enough: The hole Delek Real Estate got itself into is too deep - and Tshuva is responsible. During the boom years, he failed to restrain former Delek Real Estate CEO Ilik Rozanski, preferring instead to bask in the glory of the gigantic deals the company engineered and to receive the fat dividends it paid out. He ignored the huge salaries drawn from the company by Rozanski and son-in-law Rami Naor - and didn't insist on a settlement two years ago when the company's management was replaced.

Tshuva clung to his own sense of reality - even in the face of Delek Real Estate's deteriorating situation in the last year, and the fact that it was clearly headed toward a "painful" settlement. This reality allowed Tshuva to spend NIS 7 million on the wedding of his son, Elad, in the Ben Shemen Forest, to help buy a new NIS 12 million penthouse for the newlyweds, and to promote the appointment of his daughter, Carmit Elroy, to the position of chairwoman of Delek Israel Fuel Corporation. Members of Tshuva's inner circle say that in the last few months, he would still get upset if the word, "haircut," was mentioned, insisting he wouldn't hear of it.

Now, it's sobering up time. After making a name for himself throughout the world by buying New York's Plaza Hotel and discovering natural gas, Tshuva is now paying the heavy price for his mistakes with Delek Real Estate out of his own pocket. His initial offer to inject NIS 250 million over five years still seems too low, but it reflects the personal transition he's undergone in the last few years, indicating he's lost his sense of shame and not all of his promises are kept.

Otherwise, it's difficult to explain why Tshuva doesn't sell Delek Group stock or other assets in Israel or abroad - of which he has plenty, including a personal jet - to repay Delek Real Estate's entire debt. Instead, Delek Group is negotiating over buying Cohen Development & Industrial Buildings from Gideon Tadmor's family for NIS 270 million, and thereby increase its exposure to the gas industry, where Tshuva sees the real treasure.

Meanwhile, people saving for retirement who bought Delek Real Estate bonds will need to rely on Barnea's optimistic projections that the value of the company's assets in Israel and Europe will soar by hundreds of millions of shekels.

Over the years, Tshuva built a name for himself as a trustworthy businessman who always repays his debts, no matter what. It now seems to have become apparent that he prefers keeping the money and relinquishing his reputation. As the "haircut" proposal takes shape, Tshuva is taking time out to fly to Vietnam with a delegation of businessmen led by President Shimon Peres.

[kenny] 21/11/2011 15:50

After everyone has stated how outraged they are with Mr T, they will likely do a deal; once Mr T sweetens his offer by injecting a bit more to placate a few egos. If it goes into liquidation, I do not see that as a negative for us unless the bondholders go for a fire sale.

Either way, we DGRE holders are sitting on the assets so the bondholders will have to put up more money if they choose the liquidation route and, currently, I am guessing they will not. In a liquidation, the various classes of bondholders will be fighting about entitlement to the pie; the legal costs of which could materially reduce their recovery. I think it is about 2017 when the swaps expire so it is really not that long. That date seems to tie in with the good professors' plan.

So everyone wins the lottery in 2017, including us, providing the bondholders play ball and do not try a firesale before then. However, I get the impression that getting three people in Israel to agree is almost impossible(!) so it is difficult to predict what happens next.

[grollfam] 21/11/2011 15:12

WHAT NEXT KENNY ???? Liquidation ???????



Tshuva offer enrages bondholders
Delek Real Estate bondholders: Yitzhak Tshuva's offer is the ultimate evasion of his responsibility to us.
Koby Yeshayahou 21 Nov 11 16:46


Delek Real Estate Ltd. (TASE: DLKR) bondholders say that the debt settlement proposed by controlling shareholder Yitzhak Tshuva is the ultimate evasion of his responsibility to them. They add that his conduct is unacceptable and will have repercussions on his other businesses and on Delek Real Estate officers who are also directors.
The bondholders met today, on the basis of a summons from last week, and irrespective of yesterday's debt settlement offer. Delek Real Estate's Series 25 Bond representative slammed Tshuva's conduct for the way he informed the bondholders. In a statement some of the bonholders said, "Delek Real Estate's astonishing notice to the TASE is in effect the letter the company received from Barnea Financial Consulting, whose recommendations are not binding at all. In any event, the recommendations are, on the face of it, a dry and disappointing offer. Yitzhak Tshuva has evaded all responsibility. It should be remembered that, just in August, he claimed in an official notice to the TASE that any debt settlement that would be offered to the bondholders would not include a debt write-off, but only a rescheduling. At the moment of truth, the camouflage has been removed and it turns out that the controlling shareholder is denying his obligations."

Another bondholder said, "The disappointment over Tshuva's conduct is manifold, given the expectations that a businessman of his stature, who raised himself by his bootstraps and based his growth on raising billions of shekels from small savers, would not turn his back on these hundreds of thousands of savers at the moment of truth. The man who knew how to talk straight to the public and based his relations with the capital market on trust has disappeared from the public and left pension savers in a hopeless situation."

Tshuva told "Globes", "Nothing has changed. I intend to continue helping Delek Real Estate, and to behave differently from other controlling shareholder who neglected the companies they established."

Published by Globes [online], Israel business news - www.globes-online.com - on November 21, 2011

[grollfam] 21/11/2011 07:52

Delek Real Estate publishes debt arrangement formula

Controlling shareholder Yitzhak Tshuva to pour NIS 250 million into Delek Real Estate for asset improvement; company's NIS 2.2 billion debt will be converted into two bond series, shares

Delek Real Estate has posted Amir Barnea's formula for a debt arrangement by which the company will convert its debt to its bondholders to new bond series and shares, as reported previously by Calcalist.

The main objective of the debt arrangement formula is the improvement of the company's assets, to the extent possible. Controlling shareholder Yitzhak Tshuva will pour money into the company although to date he had not expressed consent to do so.

Barnea did not calculate the company valuation at liquidation on the understanding that in any event, upon liquidation the company's creditors and the banks have first claim on the majority of the company's first lien assets.

Without such an analysis, the company asset potential can be maintained providing the company remains a going concern.


Sources close to Delek Real Estate's controlling shareholder say that the formula reaffirms Tshuva's willingness to support the company and its investors and help it back onto the right track.


In fact, under the current formula, Tshuva will support the company for the next three years until the company's projected earnings from the its entrepreneurship initiatives start pouring in.


Barnea claims that the main benefactors of the initiatives and asset improvement are the company's debt holders.


Delek Real Estate fell into a financial distress due to the global market crises and in the past two years has been engaged in the implementation of a strategic plan for the liquidation and improvement of assets with potential value.

Under the liquidation scheme, the company sold from the beginning of 2010 over NIS 5 billion (about $1.34 billion) of assets among them the Bell tower in Canada and Roadchef in Britain to name just a couple.


The background on which the company publicized its debt arrangement formula was Tshuva's commissioning of an economic study of the alternatives available to the company to meet its financial obligations.

The work was commissioned due to the collapse of negotiations with CIM for the acquisition of the company. Concurrent negotiations with other bodies interested in acquiring Delek Real Estate came up empty handed as well.


Arrangement formula

On the whole, Barnea suggests restructuring Delek Real Estate's debt to enable asset improvement.


The company's NIS 2.2 billion ($590 million) debt, according to Barnea's formula, will be converted into two bond series and shares as follows: NIS 800 million ($215 million) of the debt will be converted into a new long-term bond series and NIS 400 million ($107 million) will be converted into two bond series convertible with the company's shares.

Additionally, debt holders will receive 70% of the company's shares that will enable them to enjoy any future improvement of the company's assets, if such an improvement does occur.

The long term series principle will be NIS 800 million, and its holders will not receive the principle payment for a five-year period. The series will have a 2% principle during 2012-2016. During the five years after that the holders of the series will receive principle payments and the interest rate will climb to 6% in 2017-2021.

Barnea explains that the long-term series holders will receive an average annual interest rate of 4%, which indicates that they will not receive any risk premium as compared to the holders of government bonds with a similar average duration and conditions.

The second bond series – the convertible bonds – will in fact constitute a balloon loan for a seven-eight year duration which means that its holders will not receive interest or principle payments until maturity of the bond in 2017-2018.

The holders of this series will have the option of converting the bonds to 30% of the company's shares after full dilution.

[kenny] 17/11/2011 17:17

Subject to the limited information in that article, it looks like DRE will retain it's shares in DGRE and continue to extract value from DGRE. That seems the most sensible course of action.

To offer the bondholders shares in DGRE was a bit impractical – there is no real market in them. There will be a market in their rescheduled bonds and they can choose to exit or retain those. Overall, the refinancing gives DRE time to extract full value from DGRE, which is good news for us. Let's hope it is not another half-baked plan from Delek management; which falls on it's face – like the dozen or so previous unrealistic plans that never got off the ground.

I am assuming that Mr T is going to offer to inject a decent amount - this must be THE plan to work as they have run out of time and every other Peter Pan type plan may have been just to buy time hoping property would turn up or the recession would end and boom times return.

[grollfam] 17/11/2011 16:48

WONDER HOW THIS AFFECTS DGRE ?????????


Tshuva to offer Delek Real Estate debt settlement


Bondholders will take a haircut of hundreds of millions of shekels, and Yitzhak Tshuva will inject a similar amount into the company.
Avi Shauly 17 Nov 11 18:10


Yitzhak Tshuva's moment of truth on Delek Real Estate Ltd. (TASE: DLKR) is closer than ever: the company will submit a NIS 2.1 billion debt settlement offer next week. The bondholders will take a haircut of hundreds of millions of shekels on their bonds, which are currently trading at junk-bond yields of 1,300%.
The proposed settlement has three parts: the issue of a new bond to replace the current bond series with a massive rescheduling of payments; conversion of debt to equity; and a capital injection by Tshuva, estimated at hundreds of millions of shekels.

Prof. Amir Barnea, the architect of the multibillion debt settlement for Lev Leviev's Africa-Israel Investments Ltd. (TASE:AFIL) in 2010, was asked to formulate Delek Real Estate's settlement.

Delek Real Estate's market cap has fallen from NIS 4.6 billion in 2007 to NIS 75 million today. The company's accumulated losses since 2008 exceed NIS 3.5 billion, and its shareholders' equity deficit in NIS 1.7 billion. Its auditors attached a going concern warning to its previous financial reports

Tshuva also owns 64% of the thriving holding company Delek Group Ltd. (TASE: DLEKG), which has a market cap of NIS 9.5 billion. Its business include oil and gas exploration companies Avner Oil and Gas LP (TASE: AVNR.L) and Delek Drilling LP (TASE: DEDR.L), fuel and refining companies Delek Israel Fuel Corporation Ltd. (TASE: DLKIS), Delek US Holdings Inc. (NYSE:DK) and Delek Europe BV, insurance company The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5), and Ford and Mazda importer Delek Automotive Systems Ltd. (TASE: DLEA). Delek also owns half of IDE Technologies Ltd., which has stakes in desalination plants. Tshuva bought out Delek Group's stake in Delek Real Estate to separate the troubled company from his other businesses.

Published by Globes [online], Israel business news - www.globes-online.com - on November 17, 2011

[grollfam] 16/11/2011 13:15

Delek Global Real Estate plc

("DGRE" or the "Company")

Proposed Interim Dividend

The board of DGRE announces that it resolved in its meeting held yesterday (15th November 2011) to declare an interim dividend of 3.37 pence per DGRE share. The dividend is payable to shareholders on the register at 16th November 2011, and is payable on 30th December 2011 (or as soon as practicable thereafter).

[kenny] 11/11/2011 10:22

No surprise that no one will buy DRE without a big haircut:

Tshuva turns to Prof. Barnea to solve Delek Real Estate's debt woes.

Over the past few weeks the company, suffering a severe lack of liquidity, has enlisted the help of Barnea - a former director of Bank Hapoalim.
By Michael Rochvarger 11.11.11

Delek Real Estate has hired economist Amir Barnea to devise a comprehensive financial plan to deal with its heavy debt load, TheMarker has learned.

Over the past few weeks the company, suffering a severe lack of liquidity, has enlisted the help of Barnea - a former director of Bank Hapoalim and the founding dean of the Arison School of Business at Herzliya's Interdisciplinary Center.

The plan will include the rescheduling of debt payments and conversion of part of the debt to shares in the company and its subsidiaries, Elad Israel Residences and Delek Global Real Estate.

Barnea was asked to prepare his proposals quickly for presentation to the company's board of directors, probably as early as next week. The plan will serve as the basis for talks with representatives of the various bondholder groups in an attempt to reach an overall settlement over NIS 2.2 billion in debts the company owes them.

Delek Real Estate's controlling owner, Yitzhak Tshuva, is expected to pump large amounts of funds into the company as part of a debt arrangement. Meanwhile, he is continuing his search for an investor willing to step into his shoes and take over the company, which is considered his business empire's Achilles' heel.

Barnea previously provided Tshuva with consulting services when he prepared an opinion for Delek Group on the implementation of the Sheshinski committee recommendations for raising royalties on natural gas. Barnea has accumulated a wealth of experience assisting companies facing debt settlements, including Lev Leviev's Africa Israel Investments, Betzalel Eiger's Dorea Investment and Developments, and Olimpia - run by a group of investors led by Oscar Kazanelson.

[kenny] 11/10/2011 14:49

If there is, presumably in the long term, estimated to be enough value to enable a buyer to recoup all the funds they inject into DRE, that bodes very well for the value of DGRE e.g. a lot more than 75p per share.

If a buyer does agree to do a deal with no haircut for DRE bondholders, the implied valuation of DGRE must be towards the upper end of my estimated valuations e.g. perhaps 133p at the low end and 230p at the high end. Hence, I am a bit sceptical about Mr T's ability to find a buyer who will agree that bondholders will not take a haircut.

For the moment, however, it is all very exciting!! (At a later date reality will set in when all the potential buyers walk away.)

[kenny] 11/10/2011 14:35

Citigroup, Canadian fund eyeing Delek

American financial services company's real estate fund, Canadian fund specializing in yield bearer property are looking into acquisition of controlling stake of Yitzhak Tshuva's struggling real estate company. Talks between Delek Real Estate, CIM cool down after latter insists on haircut for bondholders
Golan Hazani, Calcalist

Talks between the CIM Fund and Delek Real Estate over the acquisition of the controlling interest of Yitzhak Tshuva's struggling real estate company have cooled off, and now two new funds are looking into the acquisition: Citigroup's real estate fund and a Canadian fund that specializes in yield bearer property, Calcalist has learned.

However, while DGRE signed a memorandum of understanding with CIM's expatriates Avi Shemesh and Shaul Kuba, and even reported the negotiations with the fund, DGRE signed no memorandum of understanding with either of the two new prospective buyers, but did sign non-disclosure agreements with both funds regarding their valuation of DGRE's assets.

These valuations have been going on for the past two weeks vis-à-vis DGRE's management. A source with knowledge of the negotiations said the Canadian fund was offering DGRE better terms than those proposed by CIM.

Talks between Tshuva and Shemesh and Kuba hit choppy waters earlier this month, when CIM rejected Tshuva's terms which nixes a haircut to DGRE bondholders.

According to the initial draft of the agreement with CIM, the fund will take over the control of DGRE gratis, subjected to the following conditions: It would give DGRE a NIS 500 million ($135 million) loan and would agree to a debt arrangement sans haircut.

Tshuva on his part, agreed to give DGRE a NIS 100 million ($27 million) loan, which would rank as a junior loan as compared with the company's other financial obligations.

Estimates are that Tshuva will eventually agree to pour more than NIS 100 million into DGRE – perhaps even as much as NIS 250-300 million ($68-81 million), providing that the buyer would pour into DGRE more funds than those stipulated in the agreement with CIM and uphold the agreement with the company's bondholders.

Delek Real Estate's bondholders and Tshuva agreed on two main issues: The bondholders agreed to a deferral of the final principle payment of NIS 300 million to January 2012 and DGRE on its part committed to make a NIS 50 million acquisition offer for its Series 4, Series 5 and Series 25 bonds on July 2012.


Both agreements will be effective only in the event that DGRE fails to reach a debt arrangement with all of its bondholders by 2012.

Thus far, DGRE has sold off assets worth over NIS 5 billion in order to meet its financial obligations to banks and bondholders. DGRE's overall debt to its bondholders (principle plus interest) is NIS 2.4 billion ($650 million), of which NIS 900 million ($244 million) are scheduled for repayment within a year.

[grollfam] 11/10/2011 13:13

Yes, saw this, Tshuva is obviously under time pressure to do a deal by Dec....

[kenny] 11/10/2011 12:04

Interesting:

Citigroup, Canadian Fund Eye Delek Real Estate, Calcalist Says

By Shoshanna Solomon - Oct 11, 2011

A real-estate fund of Citigroup Inc. (C) and a Canadian fund are interested in acquiring a stake in Delek Real Estate Ltd. (DLKR), Calcalist reported, without saying where it got the information. A message left on the mobile phone of a spokesman for Delek Real Estate shareholder Isaac Tshuva wasn't answered immediately.

[grollfam] 06/10/2011 17:03

do not think that much..that loan was repaid from proceeds of the sale of the other large office block at 700 de la Gauchetière West, Montreal to Dundee REIT. The company pocketed $ 281 million in the transaction.

[kenny] 06/10/2011 16:18

Thanks grollfam

Also, I wonder how much of the C$20m will be needed to repay what is still outstanding from the temporary loan of C$60m they took out earlier this year in order to accelerate the previous buybacks.

[grollfam] 06/10/2011 11:54

Thanks Kenny


DGRE still has 1 more large Canadian asset, Yonge Street Toronto, which is 100% owned, & has around 20 million Canadian Dollars equity..

Problem is, Public works Cananda lease for 63.4% of building expires in 2012, & Royal Bank of Canada lease for 13% of building expires this year.....

HAS Either lease been extended???? This will affect value of property.......

[kenny] 06/10/2011 11:37

Some interesting comment at the end of this article relating to the NCP car parks although "downgrade" rather than "upgrade" may be what transpires. Development potential on a handful of car parks is unlikely to add much albeit there should be some cash due if the (slow moving) compulsary purchase of a few car parks actually closes:

Published 05:37 06.10.11

Delek Real Estate sells Canadian property for NIS 590 million

Sale comes week after company asks its B25 series bondholders for a postponement in paying principal totaling NIS 300 million while it tries to work out an overall debt settlement by January 2012.
By Oren Freund

Delek Real Estate Wednesday announced the completion of two property transactions in Canada, which brought it NIS 590 million.

Net proceeds from the sales, estimated at NIS 87 million, will be used to provide financing for Delek Global Real Estate, the company's subsidiary, in repurchasing NIS 75 million of its own shares by the end of the month.

The first transaction was for the sale of a group of shopping centers operated and anchored by Jean Coutu Group and its eponymous chain of pharmacies for a total of 116 million Canadian dollars, equivalent to NIS 414 million. The net proceeds to DGRE for its 45% stake in the assets are estimated at 17.5 million Canadian dollars, or NIS 62 million.

The second transaction was for the Carrefour Trois Rivieres commercial center. That property sold for 49 million Canadian dollars, or NIS 174 million, and net proceeds to DGRE for its 51% stake in it are estimated at 7 million Canadian dollars, or NIS 25 million.

Delek Real Estate, the real estate arm of Yitzhak Tshuva's operations, invests in income-generating properties in Israel, Canada and Western Europe. The firm has been experiencing grave cash flow problems from highly leveraged investments undertaken when markets were booming, but whose value subsequently plummeted when the markets crashed. The company has realized over NIS 5 billion in assets in an attempt to honor its debts to banks and bondholders.

Just last week, the company asked its B25 series bondholders for a postponement in paying principal totaling NIS 300 million while it tries to work out an overall debt settlement by January 2012. Bondholders acceded to this request, agreeing to postpone the payment of principal until January 2012 in exchange for an additional NIS 13 million in interest payments. They also reached an agreement with Tshuva on a purchase offer totaling NIS 50 million for series B4, B5 and B25 in July 2012.

"The company decided to ask its bondholders to agree on a short, five-month postponement in the belief that this will serve the best interests of the company and its investors," said CEO Eran Meital. "This period is needed to examine the existing upgrade potential of the company's two core assets: Elad Israel Residence and the portfolio of parking lots owned by DGRE."

[grollfam] 26/9/2011 12:19

KENNY, SEE JANUARY DEADLINE: HENCE PAYMENT LATE DEC........


Delek Real Estate Reaches Deal With Bondholders

Published September 26, 2011 | Dow Jones Newswires

JERUSALEM -(Dow Jones)- Delek Real Estate Ltd. (DLKR.TV) said Monday its bondholders have agreed to delay the principal payment, due this month, until January in exchange for a penalty fee of 13 million shekels ($3.49 million).

In addition, Delek Real Estate's controlling shareholder, Yitzhak Tshuva, will make an offer in July to buy all bonds back from bondholders for ILS50 million.

Delek Real Estate, hit by financial troubles when many of its properties declined in value due to the global economic downturn, has been trying to reach an agreement with its bondholders for several months. It also recently ended talks to transfer the 51% stake owned by Tshuva to U.S. equity firm CIM Group Inc.

Delek Real Estate invests in property in Israel, Canada and Western Europe. Tshuva also holds the controlling interest in Delek Group Ltd. (DLEKG.TV), one of Israel's largest companies.

At 0949 GMT, shares of Delek Real Estate were up ILS4.60, or 33.58%, at ILS18.70, in a higher Tel Aviv market.

[kenny] 24/9/2011 00:31

grollfam; thanks, that makes sense. Just for information; the £4.5m is equal to about 2.85p on the issued share capital remaining after the 3rd buyback albeit I would prefer another buyback to a dividend - for tax reasons.