US hedge fund CCM Master Qualified Fund Ltd. has asked the Tel Aviv District Court to declare Emblaze Ltd. (LSE: BLZ) chairman Eli Reifman bankrupt and to appoint a receiver for his assets. CCM claims that Reifman owes it NIS 39 million and that he defrauded his preferred creditors when he secured his Emblaze shares to grey market traders, including Shelli Narkiss.
Reifman is a co-founder of Emblaze and owns 17% of the company. Last month, "Globes" revealed Reifman's grey market debts.
In the statement of claim, CCM says that Reifman owes it an undisputed ₤5.12 million, which he was due to repay at the end of September under the deal in which he bought the Emblaze shares. CCM also says that, during October and November, Reifman fraudulently used his Emblaze shares to secure his debt and a debt of Invicta International Holdings to Narkiss and other grey market traders. CCM says that this fraudulent preferring of creditors, is an act that, in law, amounts to bankruptcy.
Emblaze's share price rose 3.6% to ₤0.36 today, giving a market cap of ₤40 million. The share price has fallen 43% this year.
Published by Globes [online], Israel business news - www.globes-online.com - on December 29, 2008
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