Business in Brief: March 21

Google Israel chief to head Africa office; Shekel continues to strengthen; Broadcom to buy Broadlight for $200m.

Google office in Tel Aviv 311 (photo credit: REUTERS/Baz Ratner)
Google office in Tel Aviv 311
(photo credit: REUTERS/Baz Ratner)
Google Israel chief to head Africa office
• Globes correspondent
Google Inc. has expanded the responsibilities of Google Israel, South Africa and Greece Managing Director Meir Brand to include Ghana, Kenya, Nigeria, Senegal and Uganda. Google’s offices in these countries have 80 employees. The appointment will come into effect on April 1. Today, only 9 percent of Africans have Internet access, but studies predict that the proportion will rise to 20% by 2015. Brand was appointed Google Israel managing director in 2005. He previously served as the small businesses manager at Microsoft Israel, after working at Excite Ltd., ICQ, and Booz Allen & Hamilton. He has an MBA from Harvard Business School.
Shekel continues to strengthen
The shekel is split against the dollar and euro in morning interbank trading. Continuing Monday’s trend, the shekel-dollar exchange rate is down 0.33%, compared with Mondays’s representative rate, at NIS 3.7494/$, and the shekel-euro exchange rate is up 0.2%, at NIS 4.9609/euro.
In international markets, the dollar is traded at $1.32 against the euro, and at ¥83.41 against the Japanese yen.
In Europe, secured Greek bondholders will receive $2.5 billion on their credit default swaps (CDS), a 78.5% pay-out on their investment. Globally, the price of oil, which has risen 15% since January, continues to rise against the backdrop of tensions in the Middle East. The US has sent reinforcements to the Persian Gulf, and Turkish President Recep Tayyip Erdogan is due to meet Iran’s leaders, adding pressure on Iran to pull back on its military nuclear program.
Broadcom to buy Broadlight for $200m.
• Globes correspondent
Broadcom Corporation will announce within days that it will acquire Israeli embedded chip-sets for fiber optics developer Broadlight Ltd. for $200 million. This is not the first time that the sale of Broadlight to Broadcom has been on the cards, but this time, it is a done deal.
The two companies have been in intensive negotiations for several months, after previous rounds of talks that did not result in a deal. Broadlight, based in Herzliya, has raised $62m. in six financing rounds since it was founded in 1999 by VP carriers strategy Didi Ivancovsky. Investors include Benchmark Capital, Israel Seed Partners, Star Ventures, Delta Ventures, Azure Capital Partners, Cipio Ventures and Motorola Ventures, as well as strategic investors, including Broadcom, Tellabs Inc. and Siemens Venture Capital. It also obtained a loan from Plenus Venture Lending Fund. Estimates are that Broadlight had revenue of $50m. in 2011.
Broadlight will be Broadcom’s 10th acquisition in Israel and its Israeli development center with 500 employees is the company’s largest outside of the US. In 2011, Broadcom acquired two Israeli companies – SC Square for $42m.
and Provigent for $340m. Last week, Broadcom President and CEO Scott McGregor visited Israel and told a press conference “I expect to continue acquiring more companies here.”
Broadlight was chosen as one of Globes’ most promising start ups of 2010. Broadlight and Broadcom both declined to comment on reports of the imminent acquisition.
DS Apex board approves Meitav merge
• Globes correspondent
The board of directors of DS Apex Holdings Ltd. Monday approved in principle the merger agreement with Meitav Investment House Ltd. As Globes reported Monday, the board of both companies met Monday to discuss the merger.
DS Apex is controlled by Eli Barkat. Meitav is owned by the Stepak family and Shlomo Simanovsky, with a 50.1% stake, Direct Insurance-Financial Investments Ltd., with 28.5%, and B. Gaon Holdings Ltd., with 21.4%.
In Tuesday’s notice to the Tel Aviv Stock Exchange, DS Apex says that the merger will be carried out by a share swap. Sources inform Globes that the value of the merged company will exceed NIS 1.5 billion.
According to Tuesday’s notice, DS Apex will distribute a dividend of NIS 187.5m. (NIS 5.30 per share) reducing its valuation, after which it will merge with Meitav. The Stepak family, through Maya Holdings (Yaelim) Ltd., will acquire 2.8m. shares in Meitav at NIS 22.25 per share from BRM Capital unit BRM Finance Ltd., for a total of NIS 62.4m. When the deal is complete, the Stepak family and BRM will each own 28.64% of the merged company.
In a separate notice to the TASE, Gaon Holdings said that, simultaneously with Meitav’s negotiations with DS Apex, it was in talks to sell its stake to the Stepak family, which currently owns 35% of Meitav. These talks are subject to the completion of the Meitav-DS Apex merger.
The merged company will have NIS 104.3b. in assets under management, making it Israel’s second-largest investment house, after Psagot Investment House Ltd.. It will have NIS 36.2b. managed in provident funds, NIS 26.1b. managed in exchange traded funds, and NIS 17.1b. managed in investment portfolios.
DS Apex’s share price jumped 24.6% in early trading on the TASE Tuesday to NIS 17.62, giving a market cap of NIS 670m. Gaon Holding’s share price was unchanged at NIS 0.79, giving a market cap of NIS 88m