Barclays Capital came out predicting a quick end to the shallow Israeli recession, and a return to decent growth of 2.9% by next year. Keep in mind that the Israeli economy was late to the ‘recession game’ and looks to be an early ‘exiter’ from economic turmoil as well.
With all this great news Barclays said that they expect an Israeli Shekel/USD exchange rate of 3.65 buy the end of the year. That’s a big move from the 3.93 area that the currency is trading at now.
According to Globes: “Barclays sees a less severe recession in Israel, and relatively quick growth recovery. The investment house bases its optimism on the fact that about 75% of Israeli exports are high-tech goods, and Barclays says that a rise in the Tech-Pulse Index - showing a US high-tech recovery - points to stronger Israeli exports. The Tech-Pulse Index, measured by the San Francisco branch of the US Federal Reserve, tracks the US information technology sector.”
It looks like we have started to see this happen. As Tech has led the stock market turnaround in the US, Israeli stocks that trade in the US have been flying, up over 33% this year. Keep in mind that, like it or no, President Obama’s push for alternative energy sources will be huge for Israel, as Israel is one of the big global players in cleantech and water technology. If this trend of a ‘tech led recovery’ continues, look for the Israeli hi-tech scene, from small and mid-cap tech plays on the NASDAQ to M&A to Israeli VC, to have a very strong 2nd half of ‘09, and lights out for 2010.
In a near unanimous vote, shareholders approves the acquisition of NDS by News Corp, paving the way for the company to go private. Company officials still believe that the agreed upon $63/share price will hold up even though the company has struggled somewhat with the global economic downturn.
According to a Globes report: “News Corporation and funds controlled by private equity firm Permira Advisers will pay $63 per share, and would together own the entire company. The shares would be cancelled and NDS will become a private company. News Corporation will own 49%, and the Permira funds would own approximately 51% of NDS. ”
The next hurdle the deal faces will be in UK courts and by the end of the first week of Feb. we should know the outcome.
Written by: Aaron Katsman | January 12, 2009
With a dead M&A market worldwide, it’s funny that another Israeli hi-tech player has just been acquired. Aladdin has been snapped up by Vector capital in a deal worth about $160 million. That means about a 20% premium form the close on Friday. This is being reported by the Hebrew version of Globes.
Which Israeli company may be next?????
Written by: Aaron Katsman | December 31, 2008
With the curtain closing on 2008, it’s time for me to take out my crystal ball and predict what will happen in 2009.
1- Even with a surge in the polls, due to the Israeli/Hamas conflict, both Ehud Barak and Tzipi Livni will falter badly in the upcoming Israeli elections, paving the way for former PM Benjamin Netanyahu to reclaim the title, Prime Minister.
2- Due to continued falling crude oil prices, Iran civil unrest will lead to an overthrow of Ahmadinejad.
3- The earth will continue to cool, and Obama will have to back off some of his environmentally friendly campaign promises.
4- As cracks form in the European Union and talk heats up whether the Euro will continue to exist as a currency, the US Dollar will make a strong move back to parity against the Euro.
5- US economic growth will rebound much earlier than expected, end of Q1, and we will see GDP growth of over 3% by end of ‘09.
6-S&P 500 will rebound strongly from a dreadful ‘08, and end ‘09 at 1132.
7- Despite spending the equivalent of a small country’s GDP in free agency, hated New York Yankees will contend with Baltimore for the cellar in the stacked AL East.
8- With many small market NBA teams taking a big financial hit, look for the city of Seattle to regain an NBA team.
9- With multinationals cutting back on R&D, look for the recent wave of Israeli M&A to continue, as they look to acquire technology instead of building it in-house.
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Aaron Katsman is Managing Editor of the Israel Opportunity Investor newsletter. He is lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.
