|
Report Date : |
17.04.2012 |
IDENTIFICATION DETAILS
|
Name : |
LLD DIAM |
|
|
|
|
Registered Office : |
|
|
|
|
|
Country : |
|
|
|
|
|
Date of Incorporation : |
12.10.1997 |
|
|
|
|
Legal Form : |
Private Limited Company |
|
|
|
|
Line of Business : |
Manufacturers and Traders in Diamonds, Dealing
as Cutters, Polishers, Importers, Exporters and Marketers of all Sorts of
Diamonds for Fine Jewellery |
|
|
|
|
No. of Employees : |
100 |
RATING & COMMENTS
|
MIRA’s Rating : |
B |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
Status : |
Moderate |
|
|
|
|
Payment Behaviour : |
No complaints |
|
|
|
|
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 – September 30, 2011
|
Country Name |
Previous Rating (30.06.2011) |
Current Rating (30.09.2011) |
|
Israel |
A2 |
A2 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
LLD DIAM
Telephone 972 3 755 11 11
Fax 972 3 612 27 15
23 Tuval Street
Diamond Exchange, Noam Bldg.
RAMAT GAN 52522 ISRAEL
A private limited company, incorporated as per file No. 51-254128-5 on the
12.10.1997, continuing activities which began in the mid 1970's by Lev Leviev.
Authorized share capital NIS 34,300.00, divided into -
34,300 ordinary shares of NIS 1.00 each,
of which 104 shares amounting to NIS 104.00 were issued.
1.
Lev Leviev, 99.04%,
2.
Moshe Leviev, 0.96%.
Zevulun Leviev.
Miners, international manufacturers and traders in diamonds, dealing as
cutters, polishers, importers, exporters and marketers of all sorts of diamonds
for fine jewellery.
LEVIEV Group operates in all stages of the diamonds chain – from mining and
production to sales and marketing. Dealing in cut and rough diamonds.
LEVIEV Group controls its own diamond mines, some of which are located in
Namibia and Angola. Most manufacturing and processing is abroad, imported to
Israel either as rough for sale to other dealers or as cut diamonds for sale
and export.
Diamonds and jewelry are sold also via the Group’s chain of fancy stores
around the world.
Operating from premises owned by shareholders, on a total area of 1,200 sq.
meters, in 23 Tuval Street (also referred to as 52 Bezalel Street), Noam
Building (12th & 9th floors – subject’s shareholders
own and occupies the entire floors), Diamond Exchange, Ramat Gan.
Group also operating from mines, plants and offices in South Africa,
Namibia and Angola, polishing plants in India and Far East and branches in
Antwerp, New York, London, Moscow, Rome, China/ Hong Kong, India and Dubai/
UAE.
Having 100 employees in Israel (same as in 2011 and 2010), as well as
hundreds of employees serving the LLD Group worldwide (couple of hundreds in
Israel).
Financial data not forthcoming, however subject is known to be financially
strong and solid.
Subject was hit by the severe depression in the diamond industry which
erupted in the last third of 2008 and lasted throughout 2009. Like the diamond
industry, the situation improved in 2010 (see also CHARACTER). According to
media reports, following the crisis subject’s bankers asked in the beginning of
2009 from subject to lower its credit exposure and Mr. Leviev fueled NIS 400
million and subject was left with US$ 800 million debt to its banks.
Sources in the branch estimated Lebiev’s diamond business at US$ 2 – 4
billion.
There are 8 charges for unlimited amounts registered on the company's
assets, in favor of Union Bank of Israel Ltd., Israel Discount Bank Ltd., Bank Leumi
Le’Israel Ltd. and Mizrahi Tefahot Bank Ltd. (last charge placed
September 2008).
According to the data published by the
Israel Supervisor on Diamonds in the Ministry of Industry & Trade, export
of polished diamonds by subject (actual overall sales presumed to be
higher, as there are local sales of polished diamonds and may have sales of
rough diamonds as well), were as follows:
2005 sales were US$ 601,000,000.
2006 sales were US$ 553,000,000.
2007 sales were US$ 522,000,000.
2008 sales were US$ 417,000,000.
2009 sales were US$ 241,000,000.
2010 sales were US$ 366,000,000.
Later data not published.
LEVIEV Group whole diamond and jewelry business estimated at US$ 3 billion
per year.
AFRICA ISRAEL
INVESTMENTS LTD., Leviev holds 47.27%, a large holding company with many
holdings in Israel and overseas in various fields (see more CHARACTER). Current
market value US$ 416.7 million.
MEMORAND HOLDINGS & INVESTMENTS LTD., holding company via which Lev
Leviev holds AFRICA ISRAEL Group.
AURAMINE, owns and develops gold mines in Russia (extracted 2 million tons
of gold in 2008)
SAMICOR, diamond extracting from the Angola’s Sea.
DIOMONTE FINANCING, 18%, Angola, worlds 4th largest diamond mine
(“Katoka”),
NAMCO, diamond mines in Namibia and South Africa.
MIUZ, Russia, design, manufacture and sale of jewelries, operating via 160
chain stores, mainly in Russia, CIS and Eastern Europe countries, estimated
annual sales US$ 150 million.
OPEN JOINT STOCK COMPANY MOSCOW JEWELRY FACTORY, Russia.
S.H.G., LEVIEV Group is a partner in gold and metals mining in Kyrgyzstan.
Main branches:
Union Bank of Israel Ltd., Ramat Gan Branch (062), Ramat Gan.
Bank Hapoalim Ltd., Yahalom Branch (No. 537), Ramat Gan.
Also working with:
Israel Discount Bank Ltd., Diamond Exchange
Branch (No. 080), Ramat Gan.
Mizrahi Tefahot Bank Ltd., Diamond Exchange
Business Center Branch
(No. 466), Ramat Gan.
Nothing unfavorable learned.
Lev Leviev is a
well-known veteran diamond dealer and is considered the world’s largest private
diamond dealer with worldwide reputation. His own personal wealth is estimated
in 2009 at NIS 6.5 billion, making him among the richest in the country. In
Israel, Leviev has been one of the leading and most influential business
figures, via his AFRICA ISRAEL Group. Despite the hit in the real estate and
diamond businesses due to the severe crisis (see below), thanks to its
reputation and the fact it deals in all the diamond sector chain, LEVIEV Group
managed to cross over the crisis (according to sources in the diamond branch
subject met all liabilities promptly, enjoying the fact that both customers and
suppliers want to work with subject). As the markets recovered (in the diamond
sector and generally) in 2010, Group’s financial status improved also.
In the past Leviev
was a DE BEERS sightholder, however following continuous conflicts he departed
and became the largest independent cutter and processor of diamonds in the
world, and the main source of rough diamonds, challenging the long standing
hegemony of DE BEERS and revolutionized the sector. Mr. Leviev controls many
other international companies in the diamond sector, among them are ASCORP,
RUIS DIAM
During 2004 and
2005 Leviev opened, jointly with the local authorities, 2 major plants for
diamonds polishing in Namibia and in Angola. The one in Luanda, Angola, is the
largest of its kind in Africa.
Born in Tashkent,
Uzbekistan, Leviev is also strongly involved in the Russian diamond industry
and trade.
For many years,
subject has been the leading largest diamond company in Israel, most of the
years by far largest than others. To-date it is still the largest (No.
In 2011 the LLD Group
refrained from being reported in the Israel Supervisor on Diamonds top
exporters list.
In 1996 Lev Leviev
took over control in AFRICA ISRAEL INVESTMENTS LTD., publicly traded on the Tel
Aviv Stock Exchange, land developers, building contractors, and also managing
and dealing, through subsidiaries, yielding properties, hotels and resorts,
industries, commerce and agencies. AFRICA ISRAEL Group (AFI) has been one of
the largest concerns in Israel. Other public companies in the AFI Group are
also traded on stock exchanges in Israel and abroad. AFI has been adversely hit
by the deep crisis in world financial and real estate markets, mainly due to
its real estate holdings in Russia and the USA, accumulating huge
losses -current debt in total of NIS 8 billion to the bonds holders and banks. The huge leverage
AFI used to finance the purchasing, mainly by raising bonds through the public,
led to its announcement by the end of August 2009 that it seeks arrangement
with its bonds holders. After objections of bond holders,
in December 2009 an agreement was signed between AFI and its the Institutional
Investors (who hold most of the bonds) and bond holders in volume of NIS 7.45
billion, according to which some of the debt were erased, a re-schedule for
payments set, Leviev fuel his own capital (NIS 750 million) and his controlling
share was decreased (from 75% to 47% currently).
AFI situation improved significantly as a result of the debt arrangement,
as well as the recovery in global markets (including real estate markets,
notable Russia).
Despite the
slow-down in activity in the global diamond branch during the last third of
2011, export by the local diamond sector in all 2011 recorded US$ 7,202 million
sales in cut diamonds, 23.5% higher than in 2010. This was thanks to the strong
first 2 thirds of 2011, which were stalled in the last third, reflecting the
current fragile global economy and fear of another recession wave in USA and
Europe. It should be noted that in karat terms, net export of cut diamonds rose
only by 4% from 2010.
Export of rough
diamonds in 2011 also climbed almost 15%, reaching US$ 3,515 million (fell
almost 29% in karat terms).
Import of cut
diamonds in 2011 summed up to US$ 5,682 million, representing 34.7% increase
comparing to 2010 (18% rise in karat terms), while import of rough diamonds
rose by 17.5% from 2010, totaling US$ 4,413 million (11% fall in karat terms).
In 2010, export
(net) of cut diamonds was US$ 5,832 million (up 48% from 2009, when it noted
37% decrease from 2008), rough diamonds export (net) reached US$ 3,060 million
(62% rise from 2009). Import of rough diamonds (net) in 2010 grew by 51% to US$
3,755 compared with 2009, and import of polished diamonds (net) saw 68% rise in
2010 reaching US$ 4,218 million.
In terms of target
export (polished diamonds) countries, in 2011 the USA continued to be the main
destination, with 39% of total export (41% in 2011). This comes after in early
2010, for the first time Far East markets became Israel’s diamond industry’s
main target (traditionally sales to the USA comprised some 60%-65% of total
export). Hong Kong is the 2nd largest target country, comprising 26%
of sales in 2011 (29% in 2010). Other main target countries included
Switzerland (6%), India (5%), UK (3%) and the rest of the World (21%).
According to the
President of the Israeli Diamonds Association, local diamond sector in general
managed to cross one of worst depressions in the global diamond sector caused
by the global economic crisis in 2008/9. The sector experienced almost an
entire freeze and collapse in sales of about 70% in the peak of the crisis and
2009 export diamonds shrank by some 40%. The President said that trade in the
sector rolls annual turnover of US$ 25 billion while total debt to the banks
stands on US$ 1.5 billion, down from US$ 2.4 billion in the eve of the crisis.
The Ministry for Industry & Trade also assisted the local diamond exporters
by providing bank guarantees in total scope of NIS 1 billion.
Local diamond
sector employs some 15,000 persons.
In February 2009,
Israel was ranked as the world’s largest exporter of cut diamonds, followed by
India, Belgium and South Africa.
Good for trade
engagements.
DIAMOND INDUSTRY –
INDIA
-
From time immemorial, India is well known in the world
as the birthplace for diamonds. It is difficult to trace the origin of
diamonds but history says that in the remote past, diamonds were mined only in
India. Diamond production in India can be traced back to almost 8th
Century B.C. India, in fact, remained undisputed leader till 18th
Century when Brazilian fields were discovered in 1725 followed by emergence of
S. Africa, Russia and Australia.
-
The achievement of the Indian diamond industry was
possible only due to combination of the manufacturing skills of the Indian
workforce and the untiring and unflagging efforts of the Indian diamantaires,
supported by progressive Government policies.
-
The area of study of family owned diamond businesses
derives its importance from the huge conglomerate of family run organizations
which operate in the diamond industry since many generations.
-
Some of the basic traits of family run business
enterprises include spirit of entrepreneurship, mutual trust lowers transaction
costs, small, nimble and quick to react, information as a source of advantage
and philanthropy.
-
Family owned diamond businesses need to improve on
many fronts including higher standard of corporate governance, long-term
performance – focused strategies, modern management and technology.
-
The diamond jewellery industry in India today may be
more than Rs 60000 mil and is rated amongst the fastest growing in the
world. Indi ranks third in the world in domestic diamond consumption.
-
Utmost caution is to be exercised while dealing with
some medium and large diamond traders which are usually engaged in fictitious
import – export, inter-company transactions, financially assisted by banks. In
the process, several public sector banks lost several hundred million rupees.
They mostly diverted borrowed money for diamond business into real estate and
capital markets.
-
Excerpts from Times of India dated 30th
October 2010 is as under –
DIAMOND SAGA – DIRTY DOZEN STUCK WITH 2K CR DEBT
This could be the biggest credibility crisis
the Indian diamond industry has ever faced. Fifteen banks run the risk of
losing Rs 2000 crore lent to a dozen diamond firms in Surat. Until about two
months ago, they had not repaid these dues. Bankers believe many
diamantaires borrowed money during the economic downturn two years ago and
diverted funds to businesses like real estate and capital markets. Many of
themselves made money from these businesses but their diamond companies have
gone sick and declared insolvency.
-
Most of the money borrowed from the banks in the name
of their diamond business has been diverted in real estate and the share
market. The banks are not in a position to seize their properties because in
many cases, these were purchased in the name of their relatives and friends.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.51.66 |
|
|
1 |
Rs.81.79 |
|
Euro |
1 |
Rs.67.18 |
RATING EXPLANATIONS
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
|
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 |
|
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 |
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
|
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 |
|
<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
|
-- |
NB |
New Business |
-- |
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.