Israel Corporation (TASE: ILCO) told bondholders of wholly-owned subsidiary Zim Integrated Shipping Services Ltd. that it is not asking them to forego part of the debt, but only to delay payments on the bonds. Israel Corp. added that it transferred $100 million to Zim during August, and that it will transfer an additional $250 million as part of a Zim recovery plan, if the bondholders approve the debt settlement next month.
Israel Corp. will include in the Zim recovery plan a $150 million discount over four years on the leasing fees that Zim pays Ofer Shipping Holdings Ltd.
Zim's bondholders will convene on October 14 to vote on the debt settlement. Zim said today, "The company will not ask the bondholders to write off the debt, but to postpone the original payment dates."
Zim has reported progress in talks towards the debt settlement. The company has reached understandings in principles with the shipyards for postponing delivery of four ships ordered from 2010 to 2014-15. Zim has already reached a deal to postpone the delivery of nine other ships from 2012 to 2014-15. The postponements mean that Zim has deferred $2 billion in payments.
Israel Corp's share rose 4.1% by mid-afternoon to NIS 2,313.
Published by Globes [online], Israel business news - www.globes-online.com - on September 24, 2009
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