'Old-economy' businesses seek $1b.

Electrical component and metal-manufacturing companies seek investors.

Some 100 electrical component and metal-manufacturing companies here are actively seeking the procurement of private-equity investments worth a combined $1 billion from investors both at home and from abroad, according to a survey conducted by the Manufacturers Association of Israel. The investments are expected to help companies in the two sectors increase productivity, while also improving the products they manufacture. Last year, companies in these industries hired approximately 2,100 new workers, bringing the total number of employees to 91,400 and increased sales 6 percent to an estimated NIS 70.7b., the largest such growth in 10 years. According to Eli Yaffa, the chairman of the union of electrical and metal component manufacturers at the Association, the 100 companies seeking the private investments represent 10% of the total number of such companies in Israel. He expects the increase in cash flow will significantly improve their ability to streamline productivity. Both large and small companies are among those seeking partnerships with investors, including manufacturers that produce electrical components for military equipment, home appliances and air-conditioning units, as well as metal manufacturers, such as Iscar Metalworking Co., which was purchased last year by the US billionaire investor Warren Buffett. While Israel's hi-tech market attracts most of the attention from investors, the current effort by these companies prove that there is still significant interest in Israel's "old-economy" manufacturers. Yaffa expects that 2007 will build off of the growth from last year, predicting that local sales of electrical and metal components will grow 5%, reaching NIS 47b. and overall growth will increase 5.5% to an expected NIS 74.6b. Additionally, he noted, that another 1,850 workers are expected to be hired by Israel's electrical and metal component manufacturers this year.