{ "docId": "019dd923-622c-750b-8b97-54a6fb10e23b", "docSlug": "93911ff05740", "documentTitle": "Vivion Investments", "authorId": "51_Muddy_Waters", "authorName": "Carson Block", "documentKindSlug": "research-note", "documentKindLabel": "Research note", "sourceTypeSlug": "short_seller", "sourceTypeLabel": "Short seller", "presentationDate": "2023-03-28 00:00:00", "orientation": "portrait", "aspectRatio": 0.77272725, "pageNumber": 3, "pageCount": 36, "prevPage": 2, "nextPage": 4, "slideType": "appendix_disclosure", "function": "expose_contradiction", "density": "dense", "nDataPoints": 8, "notes": "This page functions as a forensic accounting critique, exposing inconsistencies in Vivion's corporate history and financial statements.", "elementsJson": [ "paragraph", "footnote" ], "metadataConfidence": 1, "imagePath": null, "slideHref": "/slides/019dd923-622c-750b-8b97-54a6fb10e23b/3", "deckHref": "/decks/019dd923-622c-750b-8b97-54a6fb10e23b", "deckJsonHref": "/decks/019dd923-622c-750b-8b97-54a6fb10e23b.json", "deckAnchorHref": "/decks/019dd923-622c-750b-8b97-54a6fb10e23b#slide-3", "components": [ { "bbox": null, "kind": "callout", "text": "It is clear to us that Vivion’s bondholders have been bamboozled and are at real risk of having to “take a haircut.”", "attrs": null, "subkind": null, "toolName": "Visual emphasis", "toolSlug": "visual-emphasis", "confidence": null, "componentId": "019dd953-1ac5-725e-9dcb-36419513a71e", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.065, "w": 0.764, "x": 0.118, "y": 0.093 }, "kind": "paragraph", "text": "Vivion’s formation story has never been accurate, highlighting the arbitrary nature of Vivion’s asset base. Certain properties that Vivion claims had been transferred in 2018 weren’t transferred until 2019. Some properties appear to have never been transferred at all.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "0a09532d-6fba-4e23-97d2-2acd5143c58c", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.065, "w": 0.764, "x": 0.118, "y": 0.166 }, "kind": "paragraph", "text": "Investors may be unaware of Israeli press reports of Mr. Dayan’s arrest for suspected tax evasion on a gift of €180 million that Mr. Dayan and his brother Itzik claim to have received. The claimed donor denied having made this gift – and even having had the means to make such a large gift – before he passed at 91 years of age.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "585e157c-8bce-447a-bdf8-ce95244b43d3", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.215, "w": 0.764, "x": 0.118, "y": 0.493 }, "kind": "paragraph", "text": "Matanya Holdings Limited, which consolidated Vivion as a subsidiary, is an entity that Vivion reports as a creditor, having provided €713 million in loans in 2018. However, Matanya’s 2018 financials show total loan receivables from related parties of only €420 million. Vivion adduces no counterevidence to the obvious conclusion that the numbers have been interfered with to create hundreds of millions of purported loan value. Its only attempt to do so comes in its response to our initial report, in which it tries to account for missing loans in 2018 by citing financials from 2019—the obvious time difference makes any such “evidence” irrelevant. In that instance, Vivion claims that the apparently missing €325.3 million sum from the €746 million loan (see above) from its 2018 lender’s books can be explained by loans reported in 2019", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "b2585639-c88b-4d01-967c-93fba8303711", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.235, "w": 0.764, "x": 0.118, "y": 0.249 }, "kind": "paragraph", "text": "Vivion’s manipulation of asset values directly implicates its shareholder loans. In Vivion’s response, it admitted to having “repaid” €339 million, financed by Vivion’s bond sales, to its shareholders. It is clear to us that Vivion’s bondholders have been bamboozled and are at real risk of having to “take a haircut.” Mr. Dayan and the other founding shareholders established Vivion in October 2018, reportedly with the contribution of 53 real estate assets, including a portfolio of 33 German commercial real estate properties. €357 million was based on the net value of the contributed properties, split into €53 million of equity and €304 million in shareholder loans. In our original report, we showed that Vivion significantly inflated the size of these loans both through manipulative valuations of the underlying properties and evident misrepresentation of the loan payments themselves. Vivion continuously increased the balances of the shareholder loans by acquiring properties with inflated values. It then repaid the shareholder loans with real cash borrowed by Vivion.", "attrs": null, "subkind": "paragraph", "toolName": null, "toolSlug": null, "confidence": null, "componentId": "ed836a03-bd8d-4437-a694-0348c5c88ab7", "frameworkName": null, "frameworkSlug": null }, { "bbox": { "h": 0.275, "w": 0.764, "x": 0.118, "y": 0.662 }, "kind": "source-note", "text": "Footnotes 2-12 detailing sources and references for the claims made in the text.", "attrs": null, "subkind": null, "toolName": null, "toolSlug": null, "confidence": null, "componentId": "8290b66f-7b7a-4b08-8d14-0f2a81b980d5", "frameworkName": null, "frameworkSlug": null } ], "metrics": [], "tools": [], "frameworks": [], "arcBeats": [ { "to": 5, "from": 3, "beatId": "ae9c8eae-5c58-4997-acd2-141c786c6bc8", "arcName": "Problem-Agitate-Solution", "arcSlug": "problem-agitate-solution", "beatName": "Problem", "beatSlug": "problem-agitate-solution-problem-identify-pain", "evidence": "The document identifies inaccuracies in Vivion's formation story and property valuation", "position": 0, "confidence": 0.8, "parentBeatName": "Complication", "parentBeatSlug": "complication" } ], "loops": [ { "to": 36, "from": 2, "name": "Cost Of Inaction", "slug": "27-cost-of-inaction", "bestFor": "Urgent budget requests, compliance, risk mitigation", "matchId": "c267ed65-eae5-4441-a31b-25299c9e8ace", "evidence": "The document emphasizes the importance of accurate information for investors and regulators", "position": 1, "objective": "Highlight the consequences of not correcting misinformation", "structure": "The Status Quo -> The Hidden Costs Accumulating -> The Future State of Inaction -> The Tipping Point", "confidence": 0.6, "description": "Quantify what happens if the audience does nothing" } ], "imagePathAlt": null, "thumbSrc": null, "thumbSrcAlt": null, "locked": true }