Cohan Properties Faces Collapse as Creditor Seizes Control Over Debt
Cohan Properties faces a severe control crisis after its controlling shareholder pledged all shares for personal debt, prompting a takeover by Decama Finance. The company raised 412 million shekels in Tel Aviv.
Another US property company that issued debt in Israel is facing a control crisis and is at serious risk of collapse. Mike Cohan, the controlling shareholder of Cohan Properties, pledged all of his shares in the company as collateral for a personal debt to the British firm Decama Finance Limited. After failing to meet his obligations, Decama decided to exercise the lien and take control of the company. The amount of the personal debt for which the lien was exercised was not specified in the company's filing.
Cohan Properties reported today that it received a notice from Decama stating that it is a creditor of Cohan and has decided to exercise the lien on all of his shares in the company. After Cohan Properties' lawyers in the British Virgin Islands reviewed the enforcement documents and determined they met legal requirements, 100% of the company's shares previously held by Cohan were transferred to Decama. Decama is owned by Netanel Lorenzi.
The change in control has already triggered upheaval on the board of directors. Decama announced the termination of Mike Cohan, Alan Asil, and Ariella Avizada as directors and appointed Daniel Boritz as a director. Cohan himself had already resigned from the company's board of directors on September 27. The implications for Israeli investors could be even more significant, as the company stated it is examining whether the change of control gives bondholders grounds to demand immediate repayment of the debt.
Bondholders and Immediate Repayment
Cohan Properties raised 412 million shekels in March in its initial bond offering in Tel Aviv, meaning the private creditor's takeover of the controlling shareholder may now become a major event for Israeli debt holders as well. Interestingly, despite the corporate governance difficulties experienced by Cohan Properties in recent months, the value of its public debt still stands at 370 million shekels. This indicates that many investors believed until yesterday that Cohan would repay the company's debt.
Cohan Properties was established in August 2025 in the British Virgin Islands with the aim of raising debt in Israel and using it to refinance expensive debts in the US, some of which included Cohan's personal guarantees. He transferred 17 properties to the BVI company, eight of which were pledged to bondholders. The company is part of Cohan's real estate operations, which primarily hold commercial centers in the US.
The crisis erupted in July, just four months after the offering, when it was revealed that Cohan used at least 9.6 million dollars of the bond proceeds to repay loans on properties that did not belong to the company. The investigation began following a demand by the Israel Securities Authority for clarifications regarding another company transaction. It was later revealed that the amount of funds used by Cohan and his assets was larger, reaching 15.5 million dollars.
"This was not fraud. It was an honest mistake resulting from a management structure unsuited for a public company," Cohan said during an investors' call following the exposure, promising to strengthen control systems and bring in professionals familiar with the requirements of the Israeli capital market.
However, the discoveries continued. At the end of July, it was revealed that after returning some of the funds, Cohan still owed millions of dollars to the company. At the beginning of September, the company reported that his debt stood at about 4 million dollars. Cohan transferred 2 million dollars in cash and committed to settling the balance by transferring rights to a property. About two weeks later, an additional debt of 2.7 million dollars was exposed.
Cohan Properties is the second case within a few months where a relatively new BVI company that raised hundreds of millions of shekels from Israeli investors has plunged into a severe crisis shortly after its bond offering. It was preceded by Cimad, which raised 620 million shekels in December on the Tel Aviv Stock Exchange, after which it was discovered that the controlling shareholders withdrew about 100 million shekels from the accounts of the company and its subsidiaries. Consequently, if investors demand the immediate repayment of Cohan Properties' debt, such a demand could lead to insolvency.
