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ABN Amro Places Polar Ice in Receivership

Canada Firm Owes $42M

Nov 15, 2010 4:15 PM   By Denise Romano
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RAPAPORT...  Update: Since this story first appeared, a representative from RSM Richter confirmed with Rapaport News that Polar Ice Diamonds was no longer an operating company and that the diamond firm would most likely be unable to pay its debt.

11/15/2010 4:15 PM

ABN Amro filed an insolvency action against  Polar Ice Diamonds of Canada and its subsidiaries on November 3. The action is similar to filing Chapter 7 bankruptcy against an entity in the U.S.  ABN Amro seeks all fees associated with the action.  The diamond firm, which has offices in Toronto and Montreal, was then placed into receivership by the court.  RSM Richter, acting as the receiver, listed company "book value" of company assets at $13.5 million, which included  diamond inventory of $7.7 million. Richter noted that actual values were likely to differ substantially following its full review. 

The diamond firm reportedly owed ABN Amro a combined loan balance of $21.849 million, and Polar Ice, which also operates as Polar Bear Diamonds and 4114159 Canada Inc., owed unsecured creditors $20.655 million. Attorneys for Polar Ice would not comment on the case.  A call to Polar Ice president Ronen Basal seeking comment was not returned. Furthermore, on review of the Polar Ice website today, product descriptions and company information had been removed, although photos of diamond rings were still viewable

Shortly before filing the insovlency action, Susan Sigda, vice president of  ABN Amro, told the court on November 3 that the bank had been made aware that Basal had taken $4.5 million worth of diamonds on memo, but he had  not detailed the inventory as of November 1. Sigda  also told the court, "I learned that approximately $3 million worth  of diamonds (cost value) was purportedly being held at outside location where proper documentation has not been supplied to the bank."

Richter's filing noted that the receiver was in the process of reviewing Polar Ice's inventory and books, and is reviewing options to maximize recoveries.

At the present time, creditors were not required to file a proof of claim with the receiver. 

The following list includes only the top 30 creditors for which the diamond firm owes more than $250,000:

A. Moneta $1,519,270
Argaman Trading $204,150
4C's Ltd.  $851,977
Basal  $602,734
Belgium Diamond Inc.  $320,719
Bertucci  $315,330
Borsheim $354,600
Diamond Trading Company $298,209
E.Z. Diamonds $300,763
Esskay Diamonds Ltd. $693,123
Haimov Jewelers  $493,600
Infinity Gems Ltd. $399,380
Jaz Gem Corp. $226,280
Julius Klein Diamonds $243,970
KGK $3,709,815
Lazare  $876,551
Leo Schachter Diamonds $473,994
M. Aharonoff Inc. $295,635
M.Ben-Dor Diamonds $324,677
Nex Diamonds $238,018
Novel Collection $218,407
Octagon Blue $401,434
Ofer Mizrahi Diamonds $769,188
Rosy Blue $209,294
Royal Gem $740,917
Sanghavi Diamonds $686,813
Universal Diamonds $216,000
Virgin Diamonds $312,312
Weinreb Diamond $519,490
Y. Dvash $705,897
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Tags: , Denise Romano , ABN Amro, Denise Romano, Insolvency, Polar Ice Diamonds, Ronen Basal
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