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Report Date : |
03.05.2012 |
IDENTIFICATION DETAILS
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Name : |
LEO SCHACHTER DIAM |
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Formerly Known As : |
LEO SCHACHTER LTD |
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Registered Office : |
54 Bezalel Street Diamond Exchange, Yahalom Building Ramat
Gan 5252138 |
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Country : |
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Date of Incorporation : |
13.07.1981 |
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Legal Form : |
Private Limited Company |
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LINE OF BUSINESS : |
TRADERS, IMPORTERS, MARKETERS AND EXPORTERS OF POLISH
DIAMOND. |
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No. of Employees : |
Over 100 employees |
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 : |
No Complaints |
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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 – March 31st, 2012
|
Country Name |
Previous Rating (31.12.2011) |
Current Rating (31.03.2012) |
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Israel |
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 |
LEO SCHACHTER DIAM
Correct Name: LEO SCHACHTER DIAM
Telephone 972 3 576 62 22
Fax 972 3 613 24 89
54 Bezalel Street
Diamond
Exchange, Yahalom Building
RAMAT
GAN 5252138 ISRAEL
A private limited company,
incorporated as per file No. 51-089213-6 on the 13.07.1981, as an amalgamation
of the diamond business activities of Late Leo Schachter founded in the USA in
1952 and those of David Namdar in Italy.
It was originally
registered under the name SCHACHTER & NAMDAR POLISHING WORKS LTD., which
changed to LEO SCHACHTER LTD. on the 30.08.2005 and finally changed to the
present name on the 24.07.2006.
During 2004 subject's shareholders decided to split their activities, and
part of the activities were transferred to a newly established subsidiary MOSHE
NAMDAR & CO. LTD., which later in 2007 separated from subject's Group
altogether.
Authorized share
capital NIS 1,000.00, divided into –
1,000,000 ordinary shares of NIS
0.001 each,
of which shares
amounting to NIS 75.798 were issued.
1. LEO SHACHTER & CO. INC.,
of the USA, 49.5%, owned by the heirs of Leo Schachter, the Tenenbaum and
Greenberg families,
2. FANCY DIAM
3. Lenard Kramer, 5.5%,
4. Moshe Namdar, 3.83%.
1. Eliot Tenenbaum, President & Co-General
Manager,
2. David Greenberg, Co-General Manager,
3. Dov Tenenbaum,
4. Marc Tenenbaum,
5. Jonathan Austin.
Traders,
importers, marketers and exporters of polish diamond.
Almost all sales
are for export.
Among local
clients: B. BRIZA COLORS, MULTI-NATIONAL DIAMONDS, R.E.S. DIAMONDS, AVNER
EIZENSTEIN DIAMONDS.
Among local
diamond suppliers: OFER MIZRAHI DIAMONDS
Operating from owned
premises, in Yahalom Building, Diamond Exchange, 22nd Floor, in 54
Bezalel Street (also referred to as 21 Tuval Street), Ramat Gan.
Also operating from factories and offices in 11 countries around the world.
Exact number of employees unavailable. Known to have over 1,500 employees
serving LEO SHACHTER Group worldwide, of which over 100 employees in
Israel.
Financial data not
forthcoming, but known to be financially solid.
Subject owns a Sight from DE BEERS for many years. According to reports
from February 2004, they are the largest receiver from a DE BEERS Sight in
volume of US$ 150-200 million per year.
There are 5 charges for unlimited amounts
registered on the company's assets, in favor of Bank Leumi Le’Israel Ltd. and
Israel Discount Bank Ltd.
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 for export (net) were US$ 418,000,000.
2006 sales for
export (net) were US$ 460,000,000.
2007 sales for
export (net) were US$ 446,000,000.
2008 sales for export
(net) were US$ 352,000,000.
2009 sales for
export (net) were US$ 215,000,000.
2010 sales for
export (net) were US$ 359,000,000.
2011 sales for
export (net) were US$ 403,000,000.
LEO SCHACHTER DIAM
SHACHTER AND
NAMDAR HOLDINGS LTD., a holding company.
E.M.A. DIAM
KAMA-SCHACHTER,
Mumbai, India.
S.N.W LTD.
And other foreign
companies/ subsidiaries.
Subject’s
shareholders also hold and involved in many other companies.
Israel Discount Bank Ltd., Diamond Exchange Branch (No. 080), Ramat Gan.
Nothing
unfavorable learned.
Subject’s officials
refused to disclose any details, as a matter of policy.
According to the
report published by the Israel Supervisor on Diamonds in the Ministry of
Industry and Trade, subject was ranked 1st in the 2011 list of
Israel's largest polished diamonds exporters for the first time. In previous
years (2005 till 2010) subject was ranked 2nd to LLD DIAM
Subject enjoys
excellent reputation in Israel and world wide.
In 1995 it was
reported that subject’s shareholders acquired 2 floors (21st and 22nd
floors- total of 2,300 sq. meters) in the Yahalom Building, in consideration of
US$ 10 million. Part of the area was rented, the rest used by subject.
In July 2003, it
was reported that subject will own 49% in a new diamond processing plant in
Canada.
In February 2004,
it was reported that subject will establish a partnership with WILLIAM GOLDBERG
DIAM
In May 2005, it
was reported that the SCHACHTER & NAMDAR Group acquired a 3,000
sq. meters plot in central Tel Aviv, for a sum of US$ 15 million. The plot is
designed for 18 story building, for residential and commercial purposes.
In February 2004 subject announced a structural change in the SCHACHTER
& NAMDAR Group, initially the establishment of a subsidiary MOSHE NAMDAR
& CO. LTD., that, in order to maximize potential where each party will
focus on different markets. In the beginning of 2007 the split was completed
between the activities of the Namdar Brothers, Moshe Namdar and Abraham Namdar
and the LEO ASCHACHTAR Group.
It was also
reported that subject is operating to strengthen its global activities in
addressing the fast emerging Chinese market, and by strengthening the
"Leo" diamonds brand in the American, British and Italian markets.
In March 2007 it
was reported that subject is suing NIS 10 million from local contractor David
Appel, claiming he failed to return on time a loan given to him in
It was reported in
late 2008 that as part of the re-organization in subject’s Group designed to
save costs in view of the global economic crisis and its sever effect on the
diamond industry, subject had to dismiss several employees and closed down
local sorting activities, while polishing activities have been already carried
out by sub-contractors. The effects of the crisis can be seen in the plunge in
subject’s sales for export.
In the beginning
of 2009 subject suffered from the collapse of two main American diamond chains
(subject was mentioned as one of their suppliers/ creditors) CHRISTIAN BERNARD
and SHANE that went bankrupt.
As could be seen
in 2010 reported sales, it appears that subject has recovered from the 2009
crisis, as most of the diamond industry has in 2010.
A recent affair of
an underground bank is shocking the local diamond branch in these days, after
in late January 2012 Police raided the Diamond Exchange (after a long
undercover operation, in cooperation with the Exchange officials), arrested
several individuals for investigation and blocked several bank accounts (which
led to a chain reaction of not respecting checks of dealers). The Police
suspect that a group of people, including diamond dealers, run an illegal bank
in the Diamond Exchange compound for loans, money transfer abroad and exchange
in volume of NIS 1 billion for several years. The affair has already led to
several of reported bankruptcies of local diamond firms, a decrease of up to
70% in transactions, frozen bank accounts, a paralysis (especially in purchase
of raw diamonds) with substantial fear of the a collapse of the sector, while
dealers –local and foreign- face uncertainty.
In early March
2012 the Police announced it suspends the investigation of further suspects for
the time being. This move is a result of the big pressure from the diamond
branch (to stop the continuing damage inflicted) and the Government (who is
losing US$ hundred millions from decrease in tax collection).
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.
Notwithstanding the refusal to disclose
financial and other details, considered good for trade engagements.
Note: Since the beginning of 2012 Israel Post
started using a new area code method of 7 digits (the old method of 5 digits will
still be valid till end of 2012).
DIAMOND INDUSTRY –
INDIA
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.
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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.52.93 |
|
|
1 |
Rs.85.85 |
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Euro |
1 |
Rs.69.94 |
INFORMATION DETAILS
|
Report Prepared
by : |
PRL |
RATING EXPLANATIONS
|
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 |
|
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 |
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.