Israel PE Deals up Lately, Too

(Reuters) – Private equity deals in Israel grew 49 percent to $1.75 billion in the first half of 2012, mainly due to the $1 billion buyout of software firm Paradigm Geophysical by Apax Partners and JMI Equity from Fox Paine, the IVC Research Center said on Monday.

In the first half, private equity deals valued at over $50 million represented 35 percent of the total number of deals, compared to 21 percent a year earlier, said IVC and corporate law firm GKH.

Foreign private equity funds accounted for 76 percent of investments, mostly reflecting the Paradigm Geophysical buyout.

“In addition to the continuing attractiveness of Israeli technology to investors in Israel and abroad, we are starting to see the effects of two more recent drivers in the Israeli M&A market,” said Rick Mann, managing partner of GKH.

“One is the need by a number of larger Israeli shareholding groups to de-leverage and improve liquidity. The second is proposed legislation to require the sale … of several large Israeli companies, particularly in the fields of insurance, banking and asset management.”

The software sector was the most attractive area for private equity deals in the first half, capturing 62 percent of total deal value.

Internet transactions followed with 9 percent, mostly reflecting the $100 million investment in Conduit, an Internet applications company, by a JPMorgan Chase fund.

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