Troubled Real Estate Developer Lagna Holdings May be Sold by Shaya Boymelgreen

Shaya Boymelgreen, a troubled real estate developer, may be finally offloading Lagna Holdings Ltd., held through Azorim Investment, Development and Construction Ltd. An investor group led by Universal Motors Israel Ltd. (UMI) owners Haim Assayag and David Eini are in advanced talks to acquire Lagna. The company has been in dire straits, with a shareholders' equity deficit of NIS 210 million and over NIS 2 billion in debts at the end of June.

Key Takeaways:

• Lagna Holdings Ltd. may be sold by Shaya Boymelgreen after an investor group led by Universal Motors Israel Ltd. (UMI) owners Haim Assayag and David Eini entered advanced talks to acquire the company.
• The company, held through Azorim Investment, Development and Construction Ltd., has been in dire financial straits, with a shareholders' equity deficit of NIS 210 million and over NIS 2 billion in debts at the end of June.
• Trading in shares in Lagna and its subsidiaries was highly volatile, with Lagna rising 8.1 percent to NIS 3.84 in early trading, while Engel Resources plummeted 21 percent to NIS 16.97.
• Azorim acquired 63% of Lagna in 2005 from Jacob Engel for NIS 430 million, at a company value of NIS 600 million, but the company's share has since fallen 93 percent to a current market cap of NIS 38 million.
• An integral part of the deal, if one is reached, is a debt settlement, including all the bonds, for Lagna and its subsidiaries.

Statistics:

• NIS 38 million: Current market cap of Lagna Holdings Ltd.
• -93%: Percentage fall in Lagna's share since Azorim acquired 63% of the company in 2005.
• NIS 210 million: Shareholders' equity deficit of Lagna at the end of June.
• Over NIS 2 billion: Debts of Lagna at the end of June.
• 63.8%: Percentage of Azorim held by Shaya Boymelgreen through Boymelgreen Capital Ltd.

Sources:

• "Globes," Oct. 13.
• Trading Nation (Tel Aviv Stock Exchange).
• IBM NISSAN.