Published On: Sun, Jul 14th, 2013

Volksbank Romania seeks liquidation for Elran Investments

פטיש LAW/By Itzhak Dannon /

Volksbank Romania, a Romanian Bank, is asking the Tel Aviv District Court to issue a liquidation order for Elran Investments of Herzliya Israel claiming it is owed debts of NIS 11.3 million.

Volksbank Romania is a commercial bank controlled by Osterreichische Volksbanken-AG, through its subsidiary Volksbank International AG.

In court documents the bank claims that Elran Investments had signed a letter of guarantee for its benefit in connection with a financing agreement between Elran’s Romanian subsidiary New Life Drugstores and the bank. New Life Drugstores subsequently became bankrupt, has now been liquidated and removed from the Registry of companies in Romania.

The bank asserts that the amount of the loan still outstanding and payable to the bank under the terms of its loan agreement with New Life is approximately NIS 11.3 million. Accordingly two weeks earlier the bank sent a demand for repayment to Elran Investments, invoking its rights under the guarantee but has not been paid.

The liquidation request mentions that according to its own public reports Elran is already in a critical financial condition and there is presently substantial doubt over its continued existence as a going concern, including its ability to pay its debts and scheduled loan payments. It is also pointed out that according to the application for the winding-up, financial reports of Elran indicate total commitments amounting to about 80 million NIS against total assets of only about 3.5 million NIS. Also, according to the company’s own auditors there is substantial doubt about the Company’s ability to continue as a going concern.

According to Volksbank Romania in August 2010, a Court order affecting Elran’s creditors, the holders of its bonds and 3 Israeli banks, the Volksbank Romania was not considered properly by the company, even though it explicitly emphasized concern by the other parties to the agreement that Volksbank Romania may require the payment of its obligations after a settlement.

In summary, the Volksbank Romania now claims Elran is unable to pay its debt to it and is in a state of bankruptcy in accordance with the Companies Act and therefore Volksbank Romania is now requesting its dissolution.

VOLKSBANK ROMANIA SEEKS LIQUIDATION ORDER FOR ELRAN INVESTMENTS

Volksbank Romania, a Romanian Bank, is asking the Tel Aviv District Court to issue a liquidation order for Elran Investments of Herzliya Israel claiming it is owed debts of NIS 11.3 million.

Volksbank Romania is a commercial bank controlled by Osterreichische Volksbanken-AG, through its subsidiary Volksbank International AG.

In court documents the bank claims that Elran Investments had signed a letter of guarantee for its benefit in connection with a financing agreement between Elran’s Romanian subsidiary New Life Drugstores and the bank. New Life Drugstores subsequently became bankrupt, has now been liquidated and removed from the Registry of companies in Romania.

The bank asserts that the amount of the loan still outstanding and payable to the bank under the terms of its loan agreement with New Life is approximately NIS 11.3 million. Accordingly two weeks earlier the bank sent a demand for repayment to Elran Investments, invoking its rights under the guarantee but has not been paid.

The liquidation request mentions that according to its own public reports Elran is already in a critical financial condition and there is presently substantial doubt over its continued existence as a going concern, including its ability to pay its debts and scheduled loan payments. It is also pointed out that according to the application for the winding-up, financial reports of Elran indicate total commitments amounting to about 80 million NIS against total assets of only about 3.5 million NIS. Also, according to the company’s own auditors there is substantial doubt about the Company’s ability to continue as a going concern.

According to Volksbank Romania in August 2010, a Court order affecting Elran’s creditors, the holders of its bonds and 3 Israeli banks, the Volksbank Romania was not considered properly by the company, even though it explicitly emphasized concern by the other parties to the agreement that Volksbank Romania may require the payment of its obligations after a settlement.

In summary, the Volksbank Romania now claims Elran is unable to pay its debt to it and is in a state of bankruptcy in accordance with the Companies Act and therefore Volksbank Romania is now requesting its dissolution.

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