After Habas HZ Investments Ltd. (TASE: HABS) admitted last week that it could not service its debt to its bondholders, Aspen Group Ltd. (TASE:ASGR) announced this morning that it had given the trustee of the holders of Habas's series 4 bond an initial proposal for a possible debt arrangement that it intended to promote.
Aspen Group states that if the proposal moves forward, it will buy all the shares in Habas such that the bondholders will be allocated Habas securities.
Aspen proposes a €5 million loan so that Habas will not lose control of Dutch company NSI. The loan will be for six months from the date of the signing of a binding agreement, and will bear annual interest of 12%. All cash flow into Habas will first of all be used to repay the loan, and, until the loan is repaid, Aspen will have a veto over all material decisions at Habas. The loan will be used solely for the purpose of maintaining capital ratios stipulated by the banks that financed the NSI acquisition.
Aspen's offer is good for seven days.
Aspen Group is active in income producing real estate in Western Europe and in Israel. It has a management team in the Netherlands, so that NSI's activity is synergetic with its own. It has real estate assets valued at NIS 1.5 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on March 20, 2013
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