As every month, VC Cafe is re-posting the “Invest in Israel” Newsletter, published by the investment promotion center of Israel’s Ministry of Industry, Trade and Labor, which offers many helpful tools for prospecting investors. For previous editions, click here.
MORGAN STANLEY SEES ISRAELI GROWTH AT 4.8%
U.S. Investment Bank Morgan Stanley raised its growth forecast for Israel to 4.8% for both 2011 and 2012 from its previous growth forecast of 4.3%, noting that the Israeli economy “remains one of the robust and well managed among both the developed and the emerging market economies.”
“Having shown an excellent track record in weathering the most recent crisis via timely monetary and fiscal policy responses, the country earned well deserved respect and confidence among global investors,” the bank said.
FDI IN ISRAEL IN JUNE RISES ABOVE MONTHLY AVERAGE
Foreign direct investment (FDI) in Israel totaled $500 million in June, rising above the monthly average of $410 million for the first half of 2011. The majority of investments were made in the high tech sector.
Net foreign investment in stocks traded on the Tel Aviv Stock Exchange (TASE) totaled $440 million in June, 9% higher than in May, and well above the $240 million monthly average recorded during the first six months of the year.
TRADE MINISTRY LAUNCHES SPECIAL INCENTIVE PROMOTING TRADE WITH FAR EAST
Israel’s Ministry of Industry, Trade and Labor launched a new incentive to encourage and assist Israeli companies interested in trading in China and India.
A company that is selected for the program can receive up to 700,000 shekels a year for three years. The funds are to be used to help the company establish and operate an overseas office in India or China, including a local team and a consultant. The company will also receive a single grant of 400,000 shekels to set up a beta-site to prove the product or service’s application in the local market.
The program is geared to medium to large companies with sales of between 20 and 200 million shekels and annual exports of at least 10% of sales that are interested in establishing themselves in the Indian or Chinese market for the long run.
S1 CORP BUYS ISRAEL’S FUNDTECH
Financial services provider S1 Corp is buying Fundtech Ltd, a provider of payment systems and services for $325 million.
Following the acquisition S1 shareholders will own about 55 percent of the combined company and Fundtech shareholders the rest. The combined company, which will be headquartered in Atlanta, Georgia and will be called Fundtech, will be led by S1 Chief Executive Johann Dreyer.
Fundtech develops transaction banking solutions that automate activities such as payments, cash management, settlement, liquidity management, and the financial supply chain, and was founded in 1993. S1 Corporation delivers integrated financial services on an open platform to leading financial institutions, retailers, and processors.
ICQ FOUNDER SELLS ISRAEL’S DOTOMI FOR $295 MLN
ValueClick Inc. acquired digital marketer Dotomi Inc., a leader in personalized media, for $295 million.
Dotomi, which was founded in 2003, raised $17 million in funding since its inception from Globespan Capital, US Venture Partners, Investor Capital and Velocity. The company has developed a kind of private advertising channel that enables advertisers to send marketing messages directly to potential customers via Internet banners.
Dotomi founder Yair Goldfinger also co-founded ICQ, the technology known today as instant messaging. ValueClick is one of the world’s largest integrated online marketing companies.
ISRAEL’S OPHIR OPTRONICS ACQUIRED BY NEWPORT CORP
“Ophir has a history of impressive revenue growth. Their differentiated technologies, well-respected brands and strong customer relationships are an excellent fit with Newport’s strategic agenda.” – Newport president and CEO Robert J. Phillippy
Newport Corp, a U.S. manufacturer and distributor of precision components, bought Jerusalem-based Ophir Optronics Ltd. for $230 million in cash.
Ophir will become a wholly owned subsidiary of Newport and merge with a newly formed Newport subsidiary
Ophir Optronics develops and manufactures optical equipment for the defense and civilian markets. The company has plants in Israel and the US, and sales offices in the US, Japan, and Europe.
Newport Corporation, established in 1969, is a leading global supplier of advanced technology products and solutions for scientific research, life & health science, aerospace & defense, photovoltaics, industrial manufacturing, semiconductors, and microelectronics markets.
AESTHETICS COMPANY RADIANCY MERGES WITH PHOTOMEDEX
Israel’s Radiancy Inc., a privately held maker of at-home dermatological products, is merging with US company Photomedex in a share swap deal that gives Radiancy a $175 million valuation.
On completion of the deal, current PhotoMedex shareholders will own 25% of the combined company, while Radiancy’s current shareholders will hold 75%.
Among other things, Radiancy has developed a home hair removal device, a device for treating acne, and a home device for rejuvenating the skin. PhotoMedex develops excimer laser, LED light systems and skin care products for dermatological applications.
GE LIGHTING BUYS ISRAELI LED CO LIGHTECH
“In Lightech, we found extraordinary technology and business. It provides the brain of LED lighting, and we hope that it will become an important part of our lighting division.” – GE Lighting general manager John Brelus
GE Lighting has acquired Lightech Ltd. for $15-20 million. The firm, which was founded in Lod, Israel, in 1992, develops components for managing the energy supply to lighting units in order to save energy. The drivers and transformers it designs for use in LED and halogen lighting are manufactured in China.
Lightech co-founder Zvi Schreiber also founded Unicorn Solutions, which was acquired by IBM Corporation (Nasdaq: IBM) for $10 million in 2000.
Lightech has a development facility in Israel, and sales and marketing networks in Europe, Asia, and the US.
He is a former General Partner at Google Ventures (GV) in Europe, former head of Google for Entrepreneurs in Europe, and founding head of Campus London, Google's first startup hub. Eze writes on Israeli tech, venture capital, artificial intelligence, and founder strategy.
He is also the founder of Techbikers, a nonprofit that brings together the startup ecosystem on cycling challenges in support of Room to Read.
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