Israeli billionaire and Lubavitch philanthropist Lev Leviev has reached an agreement to refinance the loans that his company took out from banks and pension funds in Israel.

Africa-Israel announced two months ago that it would have trouble repaying the loans, which total £1.2 billion. Mr Leviev will pay about ten per cent of the debt from his private funds and be allowed to retain control of the company.

Part of the loans will be repaid in Africa-Israel shares and the rest of the repayments will be spread over the next ten years.

The favourable terms for Mr Leviev were explained by the creditors by their fear of the company going bankrupt, sinking with it billions of shekels of pensioners’ savings.

Mr Leviev, a close friend of Chelsea owner Roman Abramovich, moved to London in 2007, buying a £35m mansion in Hampstead, reported to be the most ever paid for a residential property in the UK.

He funded a network of Jewish schools in Russia, run by the Lubavitch movement, but had to cut his donations when his personal fortune was reduced by 85 per cent last year.