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," 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."

Hardegree spoke with "Globes" ahead of his participation in the "Globes"-Ernst & Young Israel Journey Conference in Tel Aviv on October 17. "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."

Hardegree clearly marks out high-growth sectors. "The growth areas at the moment are the Internet, SaaS, big data, and technical changes in storage. We seem to creating Internet companies faster than we can merge them, but we're probably be consolidating semiconductor companies faster than we're creating them," he says.

Published by Globes [online], Israel business news - - on October 10, 2013

© Copyright of Globes Publisher Itonut (1983) Ltd. 2013

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