Israeli debt-laden property company Delek Real Estate said that its majority shareholder has signed a preliminary agreement to sell its 50.8% stake in the company to an unnamed foreign investment fund.

In a statement to the Tel Aviv stock exchange, Delek Real Estate said the fund will pay for the stake by lending the company NIS 600 mln (EUR 117 mln), which will be used to repay the company's bondholders. In return, controlling shareholder Yitzhak Tshuva will transfer his bonds and loans for a total value of NIS 120 mln to the buyer.

Delek Real Estate owns 2.2 million m2 of real estate properties worth EUR 4.7 bn in the UK, Germany, Switzerland, Finland and Canada.

The transaction is subject to completion of due dilligence and signing of a binding agreement.