Elbit Imaging says no longer controlling shareholder of Plaza Centers
Elbit Imaging announced that it has signed a trust agreement according to which the company will deposit its shares of Plaza Centers N.V. with a trustee. In accordance with the trust agreement, Elbit retains the right to receive any and all rights in connection with the Shares, other than the voting rights which are vested with the trustee for all matters and purposes effective from December 18, 2018. In addition, Elbit may instruct the trustee, from time to time, to sell all or any portion of the Shares. The trust agreement shall terminate upon the earlier of: (i) a sale of all of the Shares to a third party; and (ii) the date on which actions have been taken for realization of any of the liens Elbit granted in favor of the holders of the Series I Notes issued by Elbit. The outcome is that Elbit no longer considers itself to be the controlling shareholder of Plaza and accordingly will not consolidate Plaza's financial reports in its own financial reports. In light of Plaza's current financial situation, Elbit estimates that the loss of control therein is not material to Elbit. In addition, following the loss of control of the Company in Plaza, the Company expects to include in its financial statements for December 31, 2018: (i) a loss in the total amount of approximately NIS 550 million which is mainly attributable mainly to realization of foreign currency translation reserves to profit and loss; and (ii) increase in Shareholders' Equity in a total amount of approximately NIS 45 million. All the amount are based on the unaudited financial reports on June 30, 2018.