MirLand bondholders push through restructuring plan terms at meeting

By Susanna Moon

Chicago, April 20 – MirLand Development Corp. plc said bondholders approved proposed restructuring terms at a meeting held last Thursday.

MirLand will make more announcements “in due course,” according to a company notice.

As announced April 13, the proposed restructuring terms were as follows:

• About $180 million of the debt owed to the bondholders will be converted into equity in the company, leaving about $45 million of outstanding bonds;

• Jerusalem Economic Ltd., Industrial Building Corp. Ltd. and Darban Investments Ltd., the controlling shareholders, will be asked to commit to providing funding of $25 million in the aggregate, including $4 million previously provided to the company, in return for a 40% interest in the company’s equity. Of this $25 million, $5 million would be paid to the bondholders, excluding the controlling shareholders and members of the Fishman family, pro rata to their holdings of bonds in the company;

• Bondholders will have a 60% interest in the company’s equity; and

• The remaining debt will be unsecured and restructured with: repayment beginning in 2021 in three equal annual installments; annual interest of 1% to be paid beginning in December 2017; company repayment option; no limitation or restriction on the company’s ability to raise any additional secured debt; and events of default only under Israeli securities law.

There were a series of announcements between April 7 and April 11 by the trustees of the holders of the company’s series A-F bonds regarding the proposed restructuring, according to a previous release.

The company said its board of directors was not asked by the trustees to consider the proposed new restructuring terms before the bondholder announcements.

The Cyprus-based real estate developer primarily functions in Russia but also has subsidiaries in Israel and Hungary.

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