Simad Holdings Defaults on $195 Million Israeli Bonds as Owners Shifted $34 Million
Updated
Updated · The Real Deal · Jun 4
Simad Holdings Defaults on $195 Million Israeli Bonds as Owners Shifted $34 Million
1 articles · Updated · The Real Deal · Jun 4
Summary
$195 million of Israeli bonds issued by Simad in December fell into default after the company disclosed it missed a payment and had transferred $34 million to firms controlled by owners Michael and David Shabsels.
Late-May filings said the transfer was inadvertent, and Simad’s audit committee asked for the money back; the brothers agreed but then said they could not return it days later.
Trading was halted after the bonds were pushed to junk status, and disclosures that other obligations were secured on subsidiary assets and cash flows raised fears the camps may have been double-pledged.
The British Virgin Islands-based company owns about 30 Northeast summer camps and 80 assets overall; 13 camps backed the 7% bonds and were supposed to give investors a first lien.
The default jolts an unusual TASE-backed financing of U.S. summer camps that had won an investment-grade rating and drew Israeli institutional buyers despite the niche collateral.