Exits in Israel 2011: IPOs Pool is Dry, Buy M&A Activity up 134%

On aggregate, putting a dollar into Israeli high-tech could yield you more than double the returns (if only these things worked on aggregate!). In the last decade, Israeli high-tech companies raised approximately $15 billion from investors, compared to more than $37 billion received in M&A and IPO exits, according to the latest IVC report.

Below are 10 interesting facts from the report:

  1. Exits involving Israeli and Israel-related high-tech companies in 2011 totaled $5.23 billion.
  2. M&A deals involving Israeli and Israel-related companies that were acquired or merged were valued at $5.1 billion, a 134 percent increase from $2.18 billion in 2010 and the second highest amount in a decade, after the $10 billion worth of deals in 2006
  3. At the same time, only $126 million was raised in five IPOs, down five percent from $133 million raised in 11 IPOs in 2010.
  4. Eighty-five Israeli companies were acquired or merged in 2011, 27 percent more than the 67 companies that were acquired or merged in 2010, and four percent more than the previous five-year average of 81.
  5. The average deal size increased nearly 85 percent to $60 million from $32.5 million in 2010.
  6. Five M&A deals exceeded $300 million and one deal – the acquisition of online advertising company MediaMind by DG – surpassed the $500 million mark.
  7. VC-backed M&A deals (33) totaled $2.52 billion, a 102 percent increase from $1.25 billion (26) in 2010. Nine of the 15 deals above $100 million had been VC-backed.
  8. Continuing the pattern of the previous year, four of five Israeli high-tech IPOs in 2011 were made on the Tel Aviv Stock Exchange. Three of the IPOs were by life science firms, and the fourth was completed by clean energy company Rosetta Green.
  9. Imperva completed the only global technology IPO by an Israeli company in 2011, raising $90 million on the NYSE Amex exchange and accounting for 72 percent of total IPO proceeds by Israeli high-tech companies in 2011.
  10. The financial needs of Israeli technology companies coupled with the shortage of investor capital indicate that more Israeli companies can be expected to go the M&A route in 2012

The charts below indicate the growth in M&A activity for Israeli companies, coupled with the decline in IPOs:

Chart 2- Israeli High-Tech Companies- Capital Raised from Investors  vs. Proceeds from M&As & IPOs (2002-2011)

Israeli High-Tech Companies- Capital Raised from Investors vs. Proceeds from M&As & IPOs (2002-2011)

 

 

 

 

 

 

 

Chart 1- M&As and IPOs of Israeli High-Tech Companies $b (2002-2011)

M&As and IPOs of Israeli High-Tech Companies $b (2002-2011)


Eze Vidra
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Eze Vidra

Chief Innovation Officer at Antidote
Eze is the Chief Innovation Officer at Antidote, a startup helping patients search and match to clinical trial, to accelerate medical breakthroughs. Previously, Ezewas a General Partner at Google Ventures Europe. Before GV, Eze founded and led Campus London, Google's first physical hub for startups, and was the Head Google for Entrepreneurs in Europe. He's an experienced product manager and startup mentor. In 2012 Eze founded Techbikers, a non-for profit supporting children education in developing countries.
Eze Vidra
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Eze Vidra

Eze is the Chief Innovation Officer at Antidote, a startup helping patients search and match to clinical trial, to accelerate medical breakthroughs. Previously, Eze was a General Partner at Google Ventures Europe. Before GV, Eze founded and led Campus London, Google’s first physical hub for startups, and was the Head Google for Entrepreneurs in Europe. He’s an experienced product manager and startup mentor. In 2012 Eze founded Techbikers, a non-for profit supporting children education in developing countries.