Lusix, the lab-grown diamond company founded by Israeli billionaire Benny Landa, has asked an Israeli court for protection from creditors under the country’s insolvency law, according to an article in CTech.
The move is meant “to consolidate a debt arrangement and set the company on a new path through a merger with another Israeli [lab-grown diamond] company,” said the report in the Israeli publication.
Lusix is believed to be hoping for a merger with Isrough, partially owned by Ofer Mizrahi. CTech said that “most of Lusix’s shareholders are willing to transfer the requested funds” if the merger goes through.
Its report quoted legal filings that said Lusix now owes 103 million shekels (around $27 million) to various entities, including its landlord and Bank Leumi. Lusix had begun “receiving warning letters from various creditors threatening to cut off electricity to its factories and take legal action against it,” said the CTech story.
Court papers said that while Lusix turned a profit in 2020, its business has since been hurt by falling lab-grown prices, increased competition, and disruptions and costs arising from Israel’s war with Hamas. The company has since put 60 of its 90 employees on leave without pay, and temporarily closed its production plant in Modi’in.
Landa tells JCK the court actions are intended to bring “the company to financial stability. I hope–and believe–that the coming weeks of moratorium will enable Lusix to do that and to get back on track.”
He adds: “I am very proud of what Lusix and its remarkable team have achieved. The company has developed amazing cutting-edge LGD technology, both for gems and for deep-tech/semiconductor applications. Its ultrahigh throughput reactor technology, together with its homoepitaxial diamond wafer capabilities, enable Lusix to at once be a super-low-cost producer and a deep-tech leader.”
Landa, a veteran tech entrepreneur, started Lusix in 2018. The company made a splash in 2022 when it attracted an investment from LVMH Luxury Ventures. In January of this year, Landa said Lusix was shifting its business toward the technology market, as well as high-end lab-grown diamonds.
(Photo courtesy of Lusix)
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