FIBI to reschedule Koor debt

Koor owes FIBI $60m, on top of $250m to Hapoalim and $160m to Leumi
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First International Bank of Israel will also apparently be rescheduling the debt owed it by Koor Industries (NYSE:KOR), which in October reached a refinancing arrangement with Bank Hapoalim, has learned.

Koor owes Israeli banks $470 million, of which $250 million is owed to Bank Hapoalim, $160 million to Bank Leumi and $60 million to FIBI. The debt to FIBI was supposed to be repaid next year.

Bank Hapoalim agreed to reschedule repayment over five years, contingent on Koor maintaining equity capital of NIS 1.2 billion, among other things.

In addition, if Koor divests any assets, Bank Hapoalim gets the first $100 million. Candidates for the block include its holdings in agrochemicals company Tel Aviv-listed Makhteshim Agan Industries, Elisra Electronic Systems, and ECtel (Nasdaq:ECTX), held through affiliate ECI Telecom (Nasdaq:ECIL).

Also, Koor will need the approval of the banks for any significant new investment.

Koor is negotiating a similar agreement with Bank Leumi, but so far the bank is balking, demanding more draconian terms. Koor's debt to Bank Leumi is due in two years.

In the last year Koor has taken a hammering from ECI, which has been reporting losses amounting to hundreds of millions of dollars. In the second quarter, Koor lost NIS 699 million, mostly due to writing down its ECI interest. For the first half, Koor posted a loss of NIS 1.7 billion.