Holding firm Iscal lost NIS 81.3 million on paper on Formula

Peled Givony group acquired control in Iscal in order to take over Formula

Author:: TheMarker.com Staff
Publish date:: Apr 12, 2002 5:17 AM EDT

Holding firm Iscal (TASE: ISCL ) lost on paper NIS 81.3 million on its holdings in information technology company Formula Systems (Nasdaq:FORTY).

Iscal, a member of the Peled Givony group, today released its financial results for 2001. Peled Givony acquired effective control in Iscal at the end of 2001, aiming to takeover Formula through Iscal.

Iscal reported a big loss, NIS 34 million for 2001, largely generated by startup holdings. But the real loss is hidden in the investment item, which includes the investment in Formula.

Iscal currently owns 12.4% of Formula capital share, listed on its balance sheet at NIS 134.1 million compared with its NIS 53 million market price, 60% less. This means that Iscal has an on-paper loss of NIS 81.3 million on its holdings in Formula.

Iscal said that in line with the new agreement it signed with the controlling shareholders in Formula, brothers Dan and Gad Goldstein, Iscal returned to the Goldsteins 245,000 Formula shares. In return, the Goldsteins waved a payment of $43 million, due under the original agreement.

Iscal noted that the booked value of the shares that were returned to the Goldsteins comes to NIS 26 million, and that the shares will be booked as a loss in the first quarter this year.