ZBV Abogados advised IRSA in a USD 272 million investment in Israeli IDB Holding Corporation

23 Jan, 2014

Zang, Bergel & Viñes Abogados advised IRSA Inversiones y Representaciones S.A., a leading real estate company listed in the NYSE and the Buenos Aires Stock Exchange, and Dolphin Fund Ltd., an investment fund incorporated under the laws of the Island of Bermuda, in the investment in Israeli holding IDB Holding Corporation Ltd. (IDBH) through a Plan of an Arrangement under the Israeli applicable law.

In this regard, the District Court in Tel Aviv approved the offer made by Dolphin jointly with other investors in order to acquire 53.3% of IDBH. This percentage might be increased, subject to the sale of certain assets in possession of such company during this year. The total investment amounts approximately to USD 272 million (NIS 950 million). The closing of this transaction will take place in the following months.

Highlights and milestones of the transaction: The transaction involved many challenges and represented a whole new learning process of a new market for us as Israel, and the negotiation of the terms and conditions for the upcoming investment, along with all the related documents for the transaction. As a matter of fact, the negotiations for the transaction started back in September 2012.

The different cultures involved, the changing regulations (see below), the different time zones, the number and variety of parties involved (bondholders, creditors, investors, trustees, among others, as well as a dozen of different law firms), the proposed timeframe are just some of the many issues involved in the transaction. All of this leads us not to forget that we were dealing with one of the biggest and most diversified holdings of Israel, which was in a distressed and very complicated situation, which made the transaction even more complex.

Another significant challenge for all parties was mainly driven by the enactment of new regulations applicable to big corporations and listed companies, as the Israeli Arrangements Law. In fact, IDBH´s Plan of Arrangement was one of the firsts in which such regulation was ever applied, and certainly one of the biggest arrangements under such new regulation.

Israel is the place for startups, in which the words innovation and creativity are strictly correlated with each individual and each corporation, in that sense we had to be creative and innovative and flexible in order reach this stage.

(PICTURED: Carolina Zang, Managing Partner, ZBV Abogados)

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