Calcalist has learned that bondholders' representative, Attorney Reli Leshem, and Dankner's representative, Attorney Ram Caspi, held a meeting into the small hours of the night and decided to put the following settlement up to the bondholders' vote:
IDB's bondholders will agree to defer the upcoming NIS 65 million ($17 million) interest payment to the bondholders of Series D bonds to March, under the condition that in the event that investor Eduardo Elsztain exercises his option, thereby injecting NIS 75 million ($20 million) into the Ganden company through which Dankner controls IDB. IDB will use that money to pay the interest to bondholders.
In the event that the parties agree to the settlement, this will be the first time IDB defers a payment, signaling debt restructuring. IDB originally wanted to pay the interest on its due date and commit to channel only NIS 65 million from Ganden to IDB if Elsztain exercised his option.
As reported previously by Calcalist, Elsztain invested $35 million in Ganden, from which NIS 35 million ($9 million) were channeled into IDB for the payment of interest to its Series B bond holders. Elsztain has to decide whether he chooses to exercise an option for another cash injection by March.
Dankner is currently in Argentina to discuss the matter with Elsztain.
Rating firm downgrades IDB
Meanwhile, the Ma'alot rating firm downgraded IDB Holdings after it failed to meet its financial obligations to its bondholders, since the corporation no longer qualifies for its SD rating.
"Given the company's financial situation, we believe that it is in clear and present danger of insolvency as a result of a debt restructuring agreement with its creditors," Ma'alot said, explaining the decision to downgrade the company to a CC rating.
Ma'alot also said that "the mention of Nochi Dankner's name in connection with last February's offering does little to benefit the holding corporation's efforts to strengthen the company."
Ma'alot rating forecast for IDB Holdings was also negative, reflecting the rating firm's expectations for the corporation's imminent insolvency.
"If the company is able to get through the next few months, it can expect to lose its liquidity advantage by early June, 2013. IDB is short NIS 310 million to meet its financial obligations for the second half of 2013."
This report was originally published in Hebrew by Calcalist