Fabrikant, one of the largest diamond firms in the industry, is in danger of collapse and insolvency, reports Israeli business publication Globes.
However, sources close to the company told JCK that the rumors are not true and the company isn’t in financial trouble.
Quoting industry sources, Globes reports that Fabrikant owes $400 million, of which $200 million is owed to U.S. banks, and $200 million to suppliers. The publication adds that the firm is believed to have deferred payments for eighteen months, and to have got into cash flow difficulties. Because of this, banks in the U.S. have had to reduce credit lines to the company to a minimum, making it difficult for it to operate.
In Israel, Fabrikant owns 50 percent of Fabrikant & Salant. The other 50 percent is owned by the Avner and Yigal Salant families of Israel. Fabrikant & Salant is one of Israel’s largest diamonds exporters, ranked fourth in the industry, with annual exports of around $200 million.
Avner Salant told Globes that Fabrikant’s global debt amounts to about $100 million, most of it to suppliers.
Another of Fabrikant’s Israeli holdings is Alpha Diamond Corp., its Israeli purchasing arm, which has recently cease buying merchandise, Globes reports. Fabrikant also has partnerships with Lev Leviev overseas.