Foreign investment in Israeli start-ups has totaled $2.1 billion since January 2006, according to a “Globes” survey. Top of the list is optical communications solutions developer, Passave Technologies, which forewent a Nasdaq IPO in favor of being sold to PMC Sierra Inc. (Nasdaq:PMCS) for $300 million in shares. Passave’s founders sold their shares in the company a few days after the sale.
The survey also found that 31 start-ups have been sold since the beginning of the year. Three start-ups were biomedical or medical devices companies: ColBar LifeScience Ltd., Alma Lasers Ltd. and Predix Pharmaceuticals Inc. The other companies developed technology of one kind or another.
EMC Corp. (NYSE:EMC) has made more investments in Israel this year than any other foreign investor. Since January, it has acquired three Israeli start-ups: Kashya, nLayers, and Proactivity for an aggregate $233 million.
Software giant Microsoft Corp. (Nasdaq:MSFT) has acquired two Israeli start-ups since January: Gteko for $120 million and Whale Communications for $76 million.
2006 has also been the year in which other US giants decided to buy an Israeli start-up. Xerox Corp. (NYSE:XRX) acquired XMPie Inc. for $54 million. McAfee Inc. (NYSE:MFE) acquired Onigma Ltd. a few days ago for $20 million.
Most of the acquisitions were in cash. Exceptions were the acquisition of Passave and SightLine (a cash and share-swap deal), the merger of Predix with Epix Pharmaceuticals Inc. (Nasdaq:EPIX), and four other acquisitions for sums of between $2 million and $52 million.
Of the 31 start-ups mentioned, seven were sold for over $100 million, and accounted for half the total foreign investment in Israeli start-ups so far this year.
Published by Globes [online], Israel business news - www.globes.co.il - on October 17, 2006
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