Kardan Seeks $75 Million for Tech Fund

Kardan Technologies is seeking $75 million (ecu 67 million) for its Kardan Technology Ventures fund, which will invest in Israeli telecommunications and data communications companies. AT&T Investment Management has committed $15 million to the vehicle, its first direct investment in an Israeli private equity fund.

KTV hit a $40 million first close in September and expects to hold a final close on or over target by January. The Danish investment group, Danalex was also named as an investor in the fund. The managers believe AT&T will help portfolio companies enter the US telecommunications market and provide a testing ground for new technologies developed by investees.

While KTV’s technology focus alone should have appealed to AT&T, the manager’s track record was likely the stronger attraction. Kardan Technologies, headed by managing partner Matty Karp, was a co-founder of the Nitzanim AVX/Kyocera Venture Fund which raised $20 million in 1994. An institutional source reports that this vehicle currently shows an IRR in excess of 190% and has distributed $53 million to investors following the Nasdaq flotations of three of its portfolio companies.

KTV, like its predecessor, plans to invest $3.5 million per deal in Internet technology, software, telecommunications data communications and healthcare companies. Early-stage venture situations will comprise around three quarters of its portfolio, with the balance invested in later-stage opportunities.