Delek Real Estate reaches debt compromise with bondholders

Deal struck after company’s near-verge of collapse for defaulting on payback of some $500 million

Delek Real Estate, one of Israel’s largest companies, reached a debt-settlement plan with bondholders Friday. The company avoided liquidation via the restructuring of its debt.

Delek Real Estate has been facing insolvency issues for months; it owes bondholders NIS 1.4 to 2 billion (approximately $400 to $500 million). Delek Real Estate, owned by Israeli business tycoon Yitzhak Tshuva, was given a May 13 deadline by district court judge Varda Alshach to work out a compromise with bondholders.

The negotiations between the company and bondholders were characterized as marathon-like and grueling. The company nearly collapsed last week after Tshuva threatened to stop funding its activities.

A court-appointed receiver, Chagai Ulman, was appointed to investigate the circumstances that led to the company’s insolvency.