Israeli tech firms make their exits, stage rich

Following the trendIT trend

High-tech startup-rich neighbourhood Herzliya Pituach, Israel. Pic by InnaFelker, editorial use only via Shutterstock
Hi-tech Israeli neighbourhood Herzliya. InnaFelker/Shutterstock.com

Israeli hi-tech companies rang the tills with exits adding up to $3.3bn in the first half of 2016.

A total of 45 hi-tech firms completed exit deals that averaged $74m, according to a study by IVC Research Center and law firm Meitar Liquornik.

Increased difficulties in raising capital, particularly in the United States and China, means that Israeli results for 2016 as a whole may approach but not surpass those of 2015, which witnessed Israeli exits of $7.4bn.

In the first half of 2016, the three largest deals involved the $811m acquisition of EZchip by Mellanox and the $643m private equity buyout of Xura and Oracle's $430m acquisition of Ravello Systems, the Jerusalem Post reports.

trendIT raised $5.9m on the London Stock Exchange but it was the only firm to go public. By contrast in 1H16, Israeli companies raised $609m in public offerings.

Many hi-tech Israeli startups specialise in cyber-security. One common narrative is veterans of the IDF’s famed 8200 intel corps applying skills they’ve learned in the military to defend enterprise networks. Would-be entrepreneurs are trying to emulate the success of firms such as Imperva, Check Point, Waze and CyberArk, whose principals also served in Israel’s equivalent of the NSA.

Other hot areas include fraud detection, hi-tech medical equipment and bio-technology. ®


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