After Bank Leumi: Judge Orenstein appoints a receiver for Fishman assets pledged to Union Bank with an overall value of 214 million shekelsPresident of the Tel Aviv District Court, Eitan Orenstein, yesterday appointed attorney Assaf Englard of law firm Hamburger Evron & Co. as receiver on behalf of Union Bank of Israel for assets of Eliezer Fishman and the companies under his ownership that are pledged to the Bank. As of the end of September, Fishman’s debts to Union Bank totaled 214 million shekels.
16.11.16 | Yasmin Gueta & Michael Rohverger
President of the Tel Aviv District Court, Eitan Orenstein, yesterday appointed attorney Assaf Englard of law firm Hamburger Evron & Co. as receiver on behalf of Union Bank of Israel for assets of Eliezer Fishman and the companies under his ownership that are pledged to the Bank. As of the end of September, Fishman’s debts to Union Bank totaled 214 million shekels.
In addition, Fishman gave the Bank a guarantee of 55.6 million shekels in respect of third party debts to the Bank – whose identity was not mentioned by Union Bank – so that in practice Union Bank is exposed to Fishman debts of 270 million shekels. Against these debts the Bank holds liens over various Fishman assets that are only worth about 50-70 million shekels. In other words, there is a gap of approximately 200 million shekels between the amount of Fishman’s debt and the value of the pledged assets. This gap is higher than Union Bank’s annual profit, which in 2015 totaled approximately 144 million shekels.
To secure the debts to the Bank, Fishman pledged 1.7 million shares in Office Textile Ltd., a private company, whose value is estimated at tens of millions of shekels, 45 thousand shares in Ten Petroleum, a private fuel and retail company, worth an estimated 15 million shekels, 3.7 million shares in the publicly traded real estate company, Jerusalem Economic Corporation, with a market value of approximately 30 million shekels, and 1,200 shares in Svitland Developmenta, a company registered in Cyprus, and which operates in the real estate market in Ukraine – whose shares are today estimated at zero in terms of economic value.
In its application filed with the Court in late September, the Bank provided a breakdown of the loans and credit it had extended to Fishman over the years. As of the date the application was filed, the company Fishman Management owes Union Bank 169 million shekels, Kedai Financial Consultants owes the Bank 25 million, and Fishman himself owes the Bank 20 million shekels.
The application was delivered to Fishman for his response, and he announced, through his counsel Shalom Goldblatt, that he is not opposed to disposition of the pledged assets, and that he is working to the best of his ability to reduce the debts.
Orenstein last month appointed advocates Eyal Rosovsky and Ronen Matry on behalf of Bank Leumi as receivers of the controlling shares of Fishman in Monitin Itonut (57.46%), which holds, among others, the controlling interest in the financial newspaper “Globes” and thus, in effect, start the process of selling control of “Globes”.
Fishman’s overall debt to the banking system totals approximately 4.5 billion shekels, of which about 3.5 billion shekels is to Bank Hapoalim and Bank Leumi. If Fishman does not reach a debt arrangement with his creditors by December 12th, Judge Eitan Orenstein may commence personal bankruptcy proceedings against Fishman, who personally guarantees a significant portion of the debt.
Orenstein gave Adv. Englard the powers to foreclose each one of the pledged assets, and instructed him to take whatever steps are necessary to best enforce the liens, obtain an appraisal opinion, publish an invitation to offer bids, and hold a bidding contest.