Professor Bebchuk Intervenes in Israel’s Largest Reorganization

At the request of one of Israel’s largest institutional investors, Professor Lucian Bebchuk submitted a report on whether the reorganization proposal of Africa-Israel Investments Ltd. would adequately protect the interests and contractual rights of public bondholders. Africa-Israel Investment Ltd., a conglomerate with business operations around the world (including the US where one of its subsidiaries owns the New York Times building), is the largest business firm to have undergone a reorganization process in Israel’s history. Given the importance of the reorganization of Africa-Israel Investments for investors, and the possibility that this reorganization might affect the structure of other reorganizations of financially distressed firms in Israel, Bebchuk carried out his review and analysis on a pro bono basis. Bebchuk’s report concluded that the proposal made by the company failed to provide adequate protection for the bondholders’ rights and interests and discussed ways in which the plan should be revised to provide bondholders with adequate protection.

Bebchuk’s report is available here. An article focusing on the report published by Haaretz, one of Israel’s main newspapers, is available here (in Hebrew).