At nearly $15b, Israeli high-tech exits, IPO values break record in 2014

Throughout the year, 70 companies either got bought out or had initial public offerings.

December 30, 2014 19:15
1 minute read.
Tel Aviv stock exchange

Tel Aviv stock exchange. (photo credit: REUTERS)


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It appears 2014 will go down in history as a record year for Israeli hi-tech companies getting bought out or going public, according to a survey by PwC Israel, released on Tuesday.

Throughout the year, 70 companies either got bought out or had initial public offerings, reaching a five-year high. The average value of the deals, moreover, stood at a record high of $212 million, roughly 25 percent higher than in 2013 and over five times the value of the average deal in 2007. Overall, the deals amounted to $14.85 billion, according to the survey.

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Most of the increased values came from companies choosing to list on stock exchanges rather than to exit. Of the 70 deals, 18 were IPOs, totaling $9.8b., as opposed to $1.2b.

in 2013. In other words, even though IPOs only accounted for about a quarter of the deals, they made up twothirds of the transaction value this year. Most of the companies that went public – 13 – listed on US exchanges (12 of them on the NASDAQ, one on the NYSE), while another five went to the AIM in London.

Though the largest number of companies to go public came from life sciences (nine) and Internet (one), the hi-tech area with the most value came from one debut classified in the field of semiconductors: Mobileye, which broke Israeli records when it went public in August on the New York Stock Exchange.

The average deal value of companies bought in mergers or acquisitions, however, fell from $165m. in 2013 to $97m. in 2014, though the number of such transactions rose from 39 to 52.

Looking to 2015, the report predicted that the trends would continue to be higher than normal, even if they don’t reach 2014 levels. In the long run, however, the government will have to work to keep Israeli hi-tech at the cutting edge, especially as companies from Asia and Eastern Europe become more competitive.

“In order to maintain its advantage in the long run, Israel must match and surpass international investment in hi-tech learning and education, and create the future generations of entrepreneurs and workers in the field of hi-tech,” the report said.

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