MIRA
INFORM REPORT
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Report Date : |
11.04.2007 |
IDENTIFICATION
DETAILS
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Name : |
ZIKA INDUSTRIES LTD. |
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Registered Office : |
Industrial Zone, Acre 24122
P.O Box 2317 |
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Country : |
Israel |
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Date of Incorporation : |
1950 |
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Legal Form : |
A Private Limited Company |
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Line of Business : |
Manufacturers, marketers and exporters of welding electrodes. |
RATING &
COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
Name and address
ZIKA INDUSTRIES LTD.
Telephone 972 4 985 18 05
Fax 972 4 985 18 70
P.O Box 2317
Industrial Zone
ACRE 24122 ISRAEL
HISTORY
A private limited company, incorporated as per file No. 51-099806-5 on the 6.9.1983, as a subsidiary of ELECTRODE WORKS ZIKA LTD., a public limited liability company established in 1950.
Originally registered under the name of KEREN DISTRIBUTORS OF WELDING PRODUCTS (AGENCIES AND IMPORT) LTD., which changed to TECHNO ZIKA (1983) LTD. on the 16.7.1990, which changed to the present name on the 17.1.2000.
During 2001-2003 the ELECTRODE WORKS ZIKA Group (subject included) encountered grave financial difficulties and reached bankruptcy. In October 2003 a request for liquidation was submitted by the Group's creditors (banks) and in February 2004 the Haifa District Court issued a liquidation order.
The Group operated under a special Court nominated manager and in August 2005, following a Creditors' Arrangement, the Court appointed an official receiver to the Group, including subject.
In June 2004, ZIKA GROUP LTD. acquired all the activities of ELECTRODE WORKS ZIKA LTD., including subject's activities, for a sum of NIS 7.26 million (see more below).
In November/ December 2007 ZIKA GROUP LTD., after obtaining all approvals, acquired subject from the liquidator and transferred all their manufacturing activities into subject.
SHARE CAPITAL
Authorized share capital NIS 93.00, divided into -
2 deciding shares,
4 management shares,
92,994 ordinary shares, all of NIS 0.001 eachof which shares amounting to NIS 1.014 were issued.
SHAREHOLDERS
Company is fully owned by ZIKA GROUP LTD., owned by CHIMNIAR GROUP LTD. (50%, controlled by Yehoshua Perla) and Yaakov Bakarach (50%).
DIRECTORS
1. Yehoshua Perla,
2. Yaakov Bakarach.
GENERAL MANAGER
Liav Bakarach
BUSINESS
Manufacturers, marketers and exporters of welding electrodes.Subject's products are used for a wide range of purposes, from thickly coated electrode for general purposes, through special electrode suitable for workings used in Nuclear reactors, petrochemical industry and heavy industry.
Around 10% of sales are for export.
Most of raw materials purchases are imported.
Amongst local materials suppliers: INBAR TECHNOLOGIES.
Amongst local service suppliers: ORIAN INTL. MARKETING, B. GAVRIELI TRANSPORTATION.
Operating from rented premises (Group's offices and plant), on an area of 8,000 sq. meters in the Industrial Zone, Acre.
Having 40 employees in subject and 50 employees serving the ZIKA Group (had 48 in the Group in 2006).
MEANS
Current Group's consolidated stock is valued at NIS 6,000,000 (same as in 2006 and 2005).
There is 1 charge for an unlimited amount registered on the company's assets, in favor of Union Bank of Israel Ltd.
ANNUAL SALES
Group's consolidated
sales (subject had no sales while in liquidation):
2005 sales claimed to
be NIS 27,000,000, of which NIS 2,000,000 were exports.
2006 sales claimed to be NIS 28,000,000, of which NIS 3,000,000 were exports.
OTHER COMPANIES
ZIKA GROUP LTD., parent company, traders, importers and marketers of electrodes and accessories. Also marketers and distributors of a variety of complementary products and services required by its customers.
CHIMNIAR GROUP LTD., controlled by Yehoshua Perla, importers and marketers of all sorts of
paper. 2004 sales claimed to be NIS 16,000,000.
CHIMNIAR PAPER
SUPPLIERS LTD.
URANUS FINANCIAL MARKETS LTD., owned by Yaakov Bakarach.
BANKERS
Bank Leumi LeIsrael Ltd., Bat Yam Branch (No. 861), Bat Yam, account No. 577500/16.
Union Bank of Israel Ltd., Main Branch (No. 063), Tel Aviv, account No. 707600/04.
A check with the Central Banks’ database did not reveal any negative information regarding subject’s a/m accounts.
CHARACTER AND
REPUTATION
Nothing unfavorable learned on subject since reactivation.
The ZIKA Group is ISO 9001:2000 certified.
The ZIKA Group is the leading welding products supplier in Israel.
On 7.6.2004 the Haifa District Court approved the sale of the activities of ELECTRODE WORKS ZIKA LTD. and subject to parent company, ZIKA GROUP LTD., from their liquidator. According to agreement, the buyers will pay NIS 7.26 million in 12 installments.
On 2.8.2004 the Commissioner for Trade Restrictions approved the transaction. The approval was required, since ELECTRODE WORKS ZIKA has been a monopoly in the welding electrodes field.
In May 2006, the liquidator of ELECTRODE WORKS ZIKA LTD. approved the acquisition of the land on which subject's plant is situated by the ZIKA Group for a sum of US$ 1.2 million.
In mid 2006 we obtained couple of favorite opinion on subject's parent company payment.
INBAR TECHNOLOGIES officials told us they are working with the ZIKA GROUP since 2004, supplying subject with welding materials. Credit terms are current + 120 days. ZIKA GROUP was described as a good client who always pays on time.
B. GAVRIEL officials told us they are working with the ZIKA GROUP for 2 years, supplying them with transport services. Credit terms are current + 90 days.
The ZIKA GROUP was described as a good client who always pays on time.
According to the Chairman of the Metal and Electricity sectors at the Manufacturers’ Association, overall sales of the various metal related sectors in 2005 increased by 13% in real terms comparing to 2004, reaching NIS 57 billion. Sales to the local market increased by 16% form 2004, summing up to NIS 34.7 billion. The metal products branch in particular noted an impressive 21.8% increase up to NIS 21.5 billion, comparing to NIS 17.6 billion in 2004. Basic metal sales amounted to NIS 4.2 billion, a 17.8% increase.
Exports in the metal and electricity sectors increased in 2005 by 9% comparing to 2004, and totaled US$ 4.96 billion.
The recovery contributed to the growth in the manufacturing activity and the number of employees in those sectors after several years of downsizing. After the increase in 2004, 800 new employees were added to the branches in 2005, bringing the total number of employees in these industries to 89,400.
SUMMARY
Maximum unsecured credit recommended US$ 160,000.
NOTE:
The report we sent you on 28.1.2007 was on ZIKA GROUP LTD., not on ELECTRODE WORKS ZIKA (as wrongly informed by Ms. Yael Regev in her correspondence with your client). ZIKA GROUP LTD and subject are of the same group, whereas ELECTRODE WORKS ZIKA is of a totally different ownership.
We never claimed that subject's Group, per se, has any debts, as may be implicated from the above mentioned correspondence.
The data on ZIKA GROUP was provided to us by the ZIKA GROUP's controller (in addition to the data we gather independently).
RATING
EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit transaction.
It has above average (strong) capability for payment of interest and
principal sums |
Large |
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56-70 |
A |
Financial & operational base are regarded healthy. General unfavourable
factors will not cause fatal effect. Satisfactory capability for payment of
interest and principal sums |
Fairly Large |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average/normal. |
Small |
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11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
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This score serves as a reference to assess SC’s credit risk and
to set the amount of credit to be extended. It is calculated from a composite
of weighted scores obtained from each of the major sections of this report. The
assessed factors and their relative weights (as indicated through %) are as
follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)