The creditors of collapsed supermarket chain Clubmarket agreed to the proposed creditors’ arrangement on Friday afternoon, according to Haaretz.
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A group of creditors, suppliers to the chain and members of the Manufacturers Association and the Federation of Israel Chambers of Commerce – whose total debts owed by Clubmarket reached 300m shekels (US$65.4m) – approved the arrangement after lengthy negotiations with the creditor banks, the tax authority and the company trustees Gabi Trabelsi and Shlomo Nass.
Part of the dispute over the arrangement had centred on the higher returns proposed for the banks – most of them being secured creditors – in contrast to the returns proposed for the suppliers – numbering hundreds, who are owed the lion’s share of Clubmarket’s 1.3bn shekel debt, but whose debts were unsecured.
Major suppliers including Strauss-Elite and Osem, who had voted against the creditors arrangement in the past, now joined this group and approved the deal.
In a letter to Clubmarket’s court-appointed trustees, the group of suppliers approved the arrangement, but with certain provisos: the banks will forgo a further 20m shekels owed them, which would be used to bolster the returns to the suppliers; the trustees should do all in their power, including resorting to the legal system, to cancel the demand by the VAT office to be recognized as a creditor; the value of Clubmarket’s inventory should be verified as Supersol has agreed to buy the inventory as well as the stortes; and if any payment of the company’s owners, directors or officials is donated to the creditors’ fund, it should be clearly destined for the suppliers.
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By GlobalDataThe suppliers also clarified that the ongoing expenses of the bankruptcy proceedings, including the fees of the trustees, would be shared by all Clubmarket’s creditors.
However, on two items no compromise was reached: the sum that Bank Leumi would receive – this would remain at 35m shekels, in respect of the sale of shares in the company to Supersol – and the sums from the creditors’ fund that would be used to compensate Clubmarket workers in respect of their change in work circumstances, now that they are employed by Supersol under poorer conditions (or redundancy pay for those dismissed by the new owners).
