Elbit Imaging Ltd (NASDAQ: EMITF) announced, following its announcement dated September 2, 2014, that Elbit Medical Technologies Ltd. ("Elbit Medical"), a subsidiary of the Company in which the Company holds approximately 83% of the voting power, has announced today that Gamida Cell Ltd. ("Gamida Cell"), in which Elbit Medical holds approximately 26% of the voting power, has notified Elbit Medical that with respect to the engagement of Gamida Cell and its shareholders in option and investment agreements with Novartis Pharma AG ("Novartis") (NYSE: NVS), which include an option granted to Novartis to purchase from the other shareholders of Gamida Cell (including Elbit Medical), all of their holdings therein (the "Option"), as follows:
1. In discussions held between the Novartis representative and the CEO of Gamida Cell, the Novartis representative notified Gamida Cell that, although Gamida Cell has successfully met all of the determined milestones, Novartis does not intend to exercise the Option. At the same time, it was further stated that Novartis was interested in continuing to collaborate with Gamida Cell in the development of its products, and will soon explore suitable alternatives with Gamida Cell.
2. Gamida Cell is examining the implications of the notice.
In accordance with Loan Agreements between the Company and Elbit Medical (as amended on March 29, 2015), in the event that Novartis were to exercise the Option, the proceeds to Elbit Medical from such transaction were to be used in 2016 for the prepayment of shareholder loans of the Company extended to Elbit Medical, in a total amount of approximately 142 million, subject to certain conditions set forth in such Loan Agreements.