The money will be used to pay off debt.
Almost a year after being taken over for $1.24 billion, ECI Telecom announced a further financial move today. The company made a $140million private placement of shares to its controlling shareholders, the Swarth group, headed by Shaul Shani, and Ashmore Investment Management. ECI will use the cash to eliminate the debt burden it took on when the acquisition was made.
The acquisition was based on equity provided by the acquirers and by $200 million debt raised from Credit Suisse. ECI repurchased the debt for $140 million, giving a $60 million gain.
According to ECI CEO Rafi Maor, the company, which was delisted last September, ended the quarter with orders of over $220 million, the highest figure since 2001. "Among other things, we intend to use the money raised to expand our activity through acquisitions of technologies and companies," Maor added.
Published by Globes [online], Israel business news - www.globes.co.il - on July 9, 2008
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