If all goes as planned, TA Associates of the US will make an exit on Israeli start-up Alma Lasers Inc. in 2007. The fund acquired control of Alma Laserts in March 2006 for $90 million. Sources inform ''Globes'' that the company is planning to hold an IPO on Nasdaq at a company value of at least $300 million.
Alma Lasers founder and CEO Ziv Karni said, “TA Associates is an investor for the long term. An issue on Nasdaq is not on the agenda. The board has not even discussed it.”
However, ''Globes'' has obtained information implying that TA Associates built a plan to float Alma Lasers on Nasdaq even before it acquired the company. The original plan called for a flotation at a company value of $400 million, but the hoped-for value has declined with the weakness in the US primary market. Sources added that Alma Lasers had its own plan for going public before it received the offer from TA Associates, and chose to go with that option.
Israeli medical devices industry sources say that Alma Lasers is another Syneron Medical Ltd. (Nasdaq: ELOS). Like Syneron, Alma Lasers was founded by former employees of ESC Medical (now Lumenis Ltd. (Pink Sheets:LUME.PK)), and Alma Lasers also develops and markets laser light-based and radio frequency devices for the aesthetic treatment market. Both Syneron and Alma Lasers have higher than average profit margins for a medical devices company, with an earnings before interest, taxes, depreciation and amortization (EBITDA) of 40%. Alma Lasers is also run by the entrepreneur who built up the company from nothing; in other words, Karni is like Syneron chairman Dr. Shimon Eckhouse.
Like Syneron, Alma Lasers was mentioned in a “Wall Street Journal” article last Thursday, the paper wrote that doctors who use lasers and other devices that claim to firm and smooth aging skin were increasingly calling into question its effectiveness. The paper said Alma Laser’s Accent device, which is waiting for US Food and Drug Administration (FDA) approval, could compete against Syneron’s VelaSmooth and ReFirme devices for treating cellulite.
Capital market sources told “Globes” that TA Associates is about to replace Karni as Alma Lasers’ CEO with an American, and that it has already begun interviewing candidates. Rumors claim that Karni is not pleased with this development.
Karni sounded quite happy in an interview with “Globes” today. “We’re appointing a CEO for Alma Lasers’ US activity. I don’t yet know what the effect of this measure will be on my job description, but nothing happens here is being dictated from on high. I initiate everything that happens in accordance with the path that I drew. Obviously, no large financial entity would invest in the company if it continued to act as it did when it was a brand new company. So we began to operate in a more organized and controlled manner. These changes were not forced on us.”
Published by Globes [online], Israel business news - www.globes.co.il - on June 21, 2006
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