MIRA
INFORM REPORT
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Report Date : |
05.03.2011 |
IDENTIFICATION DETAILS
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Name : |
ISRAEL MILITARY
INDUSTRIES LTD. |
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Formerly Known As : |
TAAS - ISRAEL INDUSTRIES LTD. |
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Registered Office : |
P.O. Box |
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Country : |
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Financials (as on) : |
31.12.2008 |
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Year of Establishment : |
1933 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Developers, manufacturers, marketers and
exporters of arms, ammunition, defense equipment, weapons, home security, and
combat systems (over 350 different products). |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Status : |
Moderate |
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Payment Behaviour : |
Unknown |
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Litigation : |
Clear |
NOTES :
Any query related to this report can be made
on e-mail: infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – December 31, 2010
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Country Name |
Previous Rating (30.09.2010) |
Current Rating (31.12.2010) |
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A2 |
A2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
Name and address
ISRAEL MILITARY INDUSTRIES LTD.
(Known as “TAAS” and “I.M.I.” in short)
Telephone 972
3 548 57 01
Fax 972 3 548 57 29; 548 66 89
RAMAT HASHARON-47205
HISTORY &
LEGAL FORMATION
Originally established in 1933 as a department
in the Ministry of Defense.
Converted into a government-owned private
limited company and registered as such as per file No. 52-003636-9 on the
3.7.1989.
Originally registered under the name ISRAEL
MILITARY INDUSTRIES LTD., which changed to TAAS - ISRAEL INDUSTRIES LTD. on the
12.6.1992, which changed back to the present one on the 22.1.1996.
In mid January
SHARE
CAPITAL
Authorized share capital
350,000,000 ordinary shares of
of which 2,687,306,702 shares amounting to
SHAREHOLDERS
Company is fully owned by the State of Israel,
through the Ministry of Defense (Minister in charge Ehud Barak).
DIRECTORS
1. Shai
Tamari,
2. Ms.
Karni Horan,
3. Ophir
Bashan,
4. Shay
Brosh,
5. Ms.
Nitza Pozner.
GENERAL
MANAGER
Avi Felder.
BUSINESS
Developers, manufacturers, marketers and
exporters of arms, ammunition, defense equipment, weapons, home security, and
combat systems (over 350 different products).
Some 65% of sales were for export.
Main local customer: Ministry of Defense (30% of
total sales in 2009).
Operation is divided into the following: Heavy
Ammunition Division, Land System Division, Rocket Systems Division, Advanced
Systems Division, Small Caliber Ammunition Division and via subsidiary ASHOT
ASHKELON LTD.
Among local suppliers: POLYURETHANE, DEAL
ENGINEERS, NORDIA SPRINGS, AHARON YOSEF & SONS PACKAGING INDUSTRIES, HNITA
METAL WORKS, VERED EROSIA, ELBE LEADING TECHNOLOGICAL SOLUTIONS, TEKTEAM, etc.
Operating from State leased (owned) premises
(including headquarters and several plants), on an area of 7,000 sq. meters, in
Ramat Hasharon, and from further 6 plants nationwide, including the
"Itzhak", "Givon", "Maltam", "Slavin"
plants and subsidiary ASHOT ASHKELON plant.
Having 3,200 employees (including subsidiary
ASHOT ASHKELON), as of end of 2009. Also employs several thousands indirectly
employees (sub-contractors). Negotiations on termination of employment of 500
are underway (as part of recovery plan).
MEANS
In December 2005, it
was reported that the Israeli Parliament approved a
In September 2008, subject reported on its financial results, which
pointed on amelioration in status: debts to suppliers were reduced during the
last couple of years by
Data from the consolidated B/S of subject based on the latest
publications of the Government Companies Authority (GCA):
31.12.2007 31.12.2008
ASSETS
Current assets 1,374,911 1,398,700
Investments 83,802 76,066
Fixed assets __453,523 __458,307
1,912,236 1,933,073
========= =========
LIABILITIES
Current liabilities 2,434,608 2,588,969
Long term liabilities 1,234,576 1,268,334
Quazi–equity clauses 2,613 3,074
Equity (deficit) (1,759,561) (1,927,304)
1,912,236 1,933,073
========= =========
B/S totaled (total assets) as of 31.12.2009 was
Cash from activities (for current activities) in deficit:
According to a
report from August 2010, the State of Israel transferred to subject over NIS
2,000 million in the last 10 years.
Subject recently
submitted a business plan for 2011, presenting a deficit of
Subject's accrued orders for 2011 stand on
There are 109 charges for unlimited amounts, as
well as charges for the amounts of
ANNUAL
SALES
2007 sales in US$: 570 million.
2008 sales in US$: 653 million.
Consolidated
Statement of Income
Year
ended 31.12
2006 2007 2008
Sales 2,023,664 2,341,675 2,343,658
Operating loss (102,276) (40,413) (89,546)
Loss before tax on
income (185,385) (105,920) (167,121)
Net loss (186,819) (106,819) (167,741)
======== ======== ========
According to reports 2009 sales were
According to a
business plan reportedly submitted by subject, it ended 2010 with an estimated net
loss of
OTHER
COMPANIES
ASHOT ASHKELON INDUSTRIES LTD., 85%, shares are
traded on the Tel Aviv Stock Exchange, maket
value US$ 27 million, manufacturers of
general mechanical precision products, automotive transmission, front and rear
axles, propeller shafts, hypoid-helical-berel and spur gears, machine tools,
shells, etc.
EUROTAAS (EUTA) LTD., 100%,
non-active,
IMI SERVICES, 100%,
IMI TRADING, 100%,
INTERNATIONAL TECHNOLOGIES AND
SYSTEMS, 100%, marketing and trade activities,
PLAINDENT, 100%, non active,
TAAS COLLAGE FOR SECURITY AND
CTU, Limited Partnership, dealing in Training and Instruction, 75%,
SIMI PTE LTD., 100%, non
active,
SCENT DETECTION TECHNOLOGIES LTD., 11.68%, a joint
venture between subject and M.S. TECH LTD., providers of innovative trace
detection technology solutions for Homeland Security and Law Enforcement
applications.
BANKERS
Bank Hapoalim Ltd., Business Central Branch (No.
600), Tel Aviv, account No. 662195.
A check with the Central Banks' database did not
reveal anything detrimental on subject’s a/m account.
Bank Otsar Hahayal Ltd., Taas Branch (No. 383),
Ramat Hasharon.
Also working with:
Bank Leumi Le’Israel Ltd.
The First
International Bank of Israel Ltd.
CHARACTER
AND REPUTATION
During all years since 1990s, subject has been
suffering financial difficulties. Until couple of years ago there were also
reports regarding delay in payments (to local suppliers).
In October 2010 it was reported that subject
delays payments to employees and pensioners, after the government ceased its
monthly financial transfer.
A main chronic problem has been the financing of
retirement pensions of over
Significant streamlining measures have been
taken in saving costs on one hand, and increasing sales on the other, which
somewhat improves subject’s status.
During 2010 subject was moved into the Indian
Government's "Black List" after accusations of bribery to Indian's
officials. In June
In mid January
In the current government decision RAFAEL has
been preferred over the other two
RAFAEL is negotiating with the Workers’
RAFAEL, originally founded in 1948, operate as
developers, designers, manufacturers, marketers and exporters of wide range of
high-tech defense systems for air, land, sea and space applications. The have
some 7,000 employees, and 2009 revenues were
In February 2005, subject sold its loosing
“Magen plant” of the Small Arms Division activities (light ammunition), for a
sum of US$ 15 million to ISRAEL WEAPON INDUSTRIES LTD. of businessman Sammy
Katzav.
Among main deals reported in 2005/6/7 to foreign
clients: NIS 50 million deal to provide tank artillery shells to India; US$ 300
million deal to provide ammunition and NIS 60 million to supply
rockets to the US Army, followed by weapon systems to
the U.S. Army in volume of US$ 80 million; Supply of mortar shells in sum of US$ 20
million to a foreign Western Army.
In addition there have been supply contracts in
value of
In December 2007, the Israeli Government decided
to terminate the unsuccessful attempt to privatize and sell subject's
subsidiary ASHOT ASHKELON. The procedure, which started with a tender published
by GCA
in 2003/4, got complicated and halted due to Court orders. There were
allegations of misconduct by the GCA selling procedures,
regarding the winning Group.
In February 2008, it was reported that the
Government will extend the work permit for 800 Turkish employees employed by
subject in Israel, as part of a transaction with the Turkish Government, in
which subject ameliorates 170 old M60 tanks for the Turkish Army in volume of
US$ 687 million.
In April 2008, US Navy ordered subject’s
deception systems for aircrafts (firing rockets from the aircraft which creates
imaginary decoys for radars), in value of
In April 2009 it was reported that subject is involved
jointly with SOLTAM (and other Israeli sub-contractors) in a major multi-year
contract for artilery weapon and ammunition signed with the Ministry of Defense
of Kazakhtan in a project of upgrading the Khazakhi Army at estimated value of
US$ 250 million. Due to claims on supply of damaged equipment and allegations
(by the Khazakhi Secret Service) on briberies, the Khzakhi Government halted
the equipping deal (which was partly supplies). Subject’s officials denied all
allegations.
In April 2009 it was reported on a US$ 240 million
deal signed with the Government of India for erection of 5 plants for
ammunition manufacturing. Subject cooperates with Indian corporation O.F.D. in
this deal.
In April 2009 it was reported that subject is
developing an electrical version to the Hummer vehicle.
In October 2009 it was reported that subject
together with EBA&D of
In July 2010 it was reported that subject
received orders in volume of US$
Subject, jointly with 3 other Israeli companies,
was ranked in 2007 among the world's top 100 defense and military companies by
the American weekly "Defense News".
SUMMARY
In view of the financial status, despite being a
State supported company, dealings are recommended on a secured basis.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
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Indian Rupees |
|
US Dollar |
1 |
Rs.44.99 |
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|
1 |
Rs.73.24 |
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Euro |
1 |
Rs.62.80 |
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 |
Capability to overcome financial difficulties seems comparatively
below average. |
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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NB |
New Business |
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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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.