Africa Israel’s shareholders and bondholders approved a plan to restructure nearly $2 billion (NIS 7.4 billion) of the company’s debt, according to a filing submitted to the Tel Aviv Stock Exchange (TASE). Diamond mogul Lev Leviev owns 75 percent of Africa Israel, a real estate company that primarily invests in U.S. and Eastern European properties. The company ran up a debt of $1.98 billion (NIS 7.4 billion) to bondholders and another $134 million (NIS 500 million) in debt to banks as the property markets plunged due to the recession.
Under the deal, Africa Israel will convert $322 million (NIS 1.2 billion) in bonds into shares in AFI Development and Africa Israel Properties. As a result, the company’s stake in AFI will fall from 71.7 percent to 54 percent. Bondholders will receive a cash payment of $148 million (NIS 550 million). Africa Israel will also issue a new series of two-year bonds worth $269 million (NIS 1 billion) and 16-year bonds worth $913 million (NIS 3.4 billion).
De Beers Refinances Credit Facilities
De Beers renewed its bank loan facilities following negotiations that began in the middle of 2009, the diamond mining company announced. The refinancing comprised a renewal and extension of its worldwide existing facilities and a $1 billion rights issue subscribed to by its shareholders.
De Beers shareholders, Anglo American, E. Oppenheimer & Son and the Botswana government, agreed in December 2009 to proportionally invest $1 billion in new equity to reduce the company’s overall debt levels. Anglo owns 40 percent of De Beers, Oppenheimer owns 45 percent and the Botswana government 15 percent.
Lynette Gould, company spokesperson, explained that De Beers international facilities amounted to $3.89 billion, including the previous $1.5 billion facility that matured March 23, 2010. “With the shareholder investment, De Beers has lowered its bank debt through 2013 from $3.89 billion to $2.89 billion,” Gould wrote in an email.
De Beers to Sell Jagersfontein Mine
De Beers Consolidated Mines Ltd. (DBCM) is inviting expressions of interest (EOIs) from other mining companies for the Jagersfontein Diamond Property in South Africa. At press time, DBCM planned to undertake the public sale process at the end of March.
DBCM noted that Jagersfontein is a mine of historical significance that predates the Kimberley discoveries. In its day, it was the source of some of the world’s largest diamonds, notably the 995.20-carat Excelsior discovered in 1893, according to the company.
Article from the Rapaport Magazine - April 2010. To subscribe click here.