Aspen Group Ltd. (TASE:ASGR), controlled by Rony Zarom, is set to take over financially troubled Habas HZ Investments Ltd. (TASE: HABS), controlled by chairman Herzel Habas. Aspen has been holding talks with the Habas bondholders representative to take over the real estate company.
The bondholders representative made a number of demands of Aspen, in response to the original offer a few months ago, and Aspen a new offer to meet them. On Tuesday, Habas postponed a bondholders meeting, probably until next week, apparently after progress was made in talks between the bondholders and Aspen.
Habas, a developer of luxury residential buildings, got into trouble when it tried to expand overseas, through the acquisition of Dutch REIT Nieuwe Steen Investments NV (NSI) (AEX:NISTI). In March, due to financing problems at NSI, Habas announced that it could not meet its payments on its NIS 450 million bond debt. The company's auditors attached a going concern warning to its financial report for the first quarter of 2013, after the company posted a NIS 42 million quarterly loss on top of its loss of NIS 265 million in 2012, and swung to a shareholders' equity deficit of NIS 23 million.
Aspen, which owns extensive income-producing property in Western Europe, with a focus on the Netherlands (where it keeps a management team), proposed acquiring Habas, and opened talks with its bondholders representative (Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) and Psagot Investment House Ltd.) to secure their consent. Aspen is familiar with NSI's portfolio, and taking it over will serve Aspen's expansion strategy in Western Europe.
Published by Globes [online], Israel business news - www.globes-online.com - on June 6, 2013
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