from the November 2013 issue

Barclays exec sees big Israeli M&A deals ahead

Barclays Capital technology M&A manager Richard Hardegree says there may be 2-3 $1 billion-plus deals a year in Israel.

"It's possible that we'll see 2-3 $1 billion-plus deals (in Israel) a year. We think that this is the direction, and that we'll also see many transactions in the hundreds of millions," said Barclays Capital technology M&A manager Richard Hardegree told "Globes". "This is definitely a change from the sizes of the past. I think that it's because Israeli companies are turning in the direction of bigger opportunities and the success of companies which have become market leaders."

"I spend a lot of time with Israeli companies and US companies that are looking at Israeli companies. There are many opportunities in Israel and most big high-tech companies consider Israel as a source of opportunities, and they are constantly seeking acquisitions here," he said.

Israeli high-tech seems to have taken a great leap forward in the past year. Even if deals the size of Waze Ltd., which was acquired by Google Inc. (Nasdaq: GOOG) for nearly $1 billion are exceptional, prominent acquisitions have climbed to $400-500 million in the past two years from $200-300 million beforehand. Then there are deals like IBM Corporation's (NYSE: IBM) acquisition of Trusteer Inc. and the merger of Perion Network Ltd. (Nasdaq:PERI: TASE:PERI) with a Conduit Ltd. spinoff at a company value of $700 million for the latter.

"I believe that the level of experience of Israeli managers has risen, such as Mellanox Technologies Ltd. (Nasdaq:MLNX) CEO Eyal Waldman, who previously worked for multinationals and whose goal is to build a global leader. The acquisition of Waze was designed to achieve a huge market. When companies like Facebook, Apple, and Samsung chase after these opportunities, you reach extraordinary deals."

Reprinted from the Israel High-Tech & Investment Report November 2013

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