On Thursday the

Gmul Investment Company (TASE:

GMUL

) announced negotiations with

FIBI Holdings (TASE:

FIBI

) to buy the holdings of its subsidiary, FIBI Investments, in

Ellern Investments (TASE:

ELIN

), for $8 million.

It now transpires that FIBI will itself be financing the deal.

FIBI is slated to lend Gmul the entire sum for a five year period, at prevailing market terms. Forty-five percent of the sum will be a nonrecourse loan.

Ellern Investments is supposed to buy control over

Dankner Investment (TASE:

DKNR

),

Dor Chemicals (TASE:

DORC

) and

Israel Salt Industries (TASE:

SALT

).

FIBI and Gmul also agreed that if those deals are not finalized, the entire loan will turn into a nonrecourse vehicle, and FIBI may exercise an option to repurchase the Ellern shares for the same $8 million, plus a sum for interest on the loan until such time.

Until the loan is repaid, FIBI will have rights to the Ellern shares.