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UMI is the authorized importer for Chrysler LLC, Isuzu Motors Ltd. (TSE: 7202), Saab Automobile AB, and other carmakers.
Eini told "Globes", "We're in talks with Azorim on the matter, and we hope for the best, but we haven't yet reached the finish line."
Lagna is the holding company for Engel Construction and Development Ltd. and its subsidiaries Engel Europe Ltd., (TASE: ENGR1 ,ENGR5), Engel East Europe NV (AIM:EEE), Engel Resources and Development Ltd. (TASE:ENRS), and Engel General Developers Ltd, which operates in the US.
Trading in shares in Lagna and its subsidiaries was very volatile yesterday. In early trading today, Lagna rose 8.1 percent to NIS 3.84, Engel Europe, was flat at NIS 15.04, giving a market cap of NIS 40 million, and Engel Resources plummeted 21 percent to NIS 16.97, giving a market cap of NIS 16 million.
Boymelgreen owns 63.8 percent of Azorim through Boymelgreen Capital Ltd. (TASE:BMGN). Azorim acquired x percent of Lagna in 2005 from Jacob Engel for NIS 430 million, at a company value of NIS 600 million. Lagna's share has since fallen 93 percent to a current market cap of NIS 38 million.
Boymelgreen is now paying for that investment. Lagna is in dire straits, with a shareholders' equity deficit of NIS 210 million and over NIS 2 billion in debts at the end of June. The company's auditor appended a going concern warning to the financial report for the second quarter.
Commenting on Lagna's condition, saying, "This will be part of any deal; which liabilities we will assume, and which we won't, and at what price. We will still discuss these matters."
"Globes": Why do you want the company?
Eini: "It has potential in the Israeli real estate market."
Sources said that an integral part of the deal, if one is reached, is a debt settlement, including all the bonds, for Lagna and its subsidiaries. Of the subsidiaries, only Engel Europe and Engel Resources have a reasonable cash flow. Lagna's foreign assets are mostly undeveloped land in Romania, Serbia, Ukraine, and elsewhere in Eastern Europe. Most of the projects have been suspended.
Azorim's share rose 2.6 percent in early trading today to NIS 22.82 and Boymelgreen Capital's share rose 0.8 percent to NIS 13.
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