DB analyst downgrades Africa-Israel

Deutsche Bank Dan Harverd has downgraded Africa-Israel from “hold” to “buy”, claiming that although the company is likely to survive the recession, its strategy provides better prospects for bond holders than it does for shareholders.

The analyst says that while recent property sales have been at fair values (“no fire sale here”), and the proceeds will go to pay NIS 3 billion in debt due over the next two years, there is still a further NIS 2 billion is due for repayment over the following two years, “the sources of which are less clear and may potentially necessitate dilution of equity holders”.

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