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Israel private equity deals drop in 2013
Investments, transactions in Israeli industry decline 39 percent over previous year, but private equity deals seen rebounding in 2014
Private equity deals in Israel declined by 39 percent in 2013 to $2.2 billion, with the industrial sector pulling in the most investments, but stronger numbers are expected this year, the IVC Research Center said on Wednesday.
The $500 million buyout of Alliance Tire Group by KKR, a foreign private equity fund, was the largest deal last year, accounting for 23 percent of the total.
Tamed Transactions
Seventeen transactions attract $939 million in first half of 2013, down from $1.8 billion attracted in 26 deals in first half of 2012, IVC reports
Reasons for the decline include higher valuations offered by strategic buyers, a greater focus by private equity firms worldwide to realize profits on existing investments and a general sense of caution in investing, said Rick Mann, a partner and head of mergers and acquisitions at GKH.
The forecast for 2014 was positive, however, since Israel's government passed a law to increase market competition.
"Because of the large number of companies that are expected to be on the shelf as a result of Israel's recent legislation to restrict economic concentration and holding company structures, we believe that the coming year will offer significant opportunities for PE investment," Mann said.
