As informed by IRSA, at the end of the fiscal year ended on June 30, 2014, occurred the closing of the transaction by which Dolphin Netherlands B.V. (“DN B.V.”), a shell corporation of Dolphin Fund Limited (“DFL”), a trust incorporated under the laws of the Isle of Bermuda, acquired together with C.A.A. Extra Holdings Limited, a company incorporated under the laws of Israel, controlled by Mordechay Ben Moshé ( “ETH”) 106,6 million ordinary shares of IDB Development Corporation Ltd. ( “IDBD”) representative of 53,33% of its issued share capital. . Such acquisition was made in the framework of the debt arrangement process of the parent company of IDBD, IDB Holdings Corporation Ltd., with its creditors. In accordance with the terms of a shareholders’ agreement entered into by DFL and E.T.H.M.B.M. Extra Holdings Ltd. (a corporation controlled by Mordechay Ben Moshé), to which DN B.V. and CAA acceded, DN B.V. participated in such investment for 50% while CAA acquired the remaining 50% of such investment. The total amount invested amounted to NIS 950 million, equivalent to approx. U$S 272 million.
Taking into consideration that the financial statements of DFL have been consolidated with the financial statements of IRSA as of June 30, 2014 and having been done the same with the financial statements of our Company and IRSA, we understand that every modification will have to be reflected on the financial statements of Cresud.
As of the date of this letter, the result of IRSA’s analysis is still pending. If as a result of such analysis it is considered necessary, the Company will proceed to amend its consolidated financial statements so to take into consideration the possible variations that may appear as a result of such revaluation and to register those modifications, which will be informed as soon as the Board of Directors have considered it.
In connection with what it is mentioned above, the Board of Directors deems convenient, in order to protect the interest of the shareholders and to allow the analysis of such changes, to consider the proposition of a recess to the next annual shareholders meeting that will be held on October 31, 2014, to allow the analysis of such changes.