IT services provider Formula Systems Ltd. (Nasdaq: FORTY; TASE: FORT) today filed a draft prospectus with the Israel Securities Authority and the Tel Aviv Stock Exchange for a proposed public offering of debentures in Israel. The company did not disclose details of the proposed offering and it is still reviewing potential underwriters.
Market sources believe that Formula will try to raise NIS 100-150 million. This is the first time that the company is seeking to hold a bond issue, although subsidiaries have already done so.
Formula said that it intends to use the net proceeds from the proposed offering for general corporate purposes, which may include future acquisitions and financing its operating and investment activity.
Emblaze Ltd. (LSE: BLZ) owns 52% of Formula, which in turn owns the controlling stake in IT service companies Matrix IT Ltd. (TASE:MTRX), Magic Software Enterprises Ltd. (Nasdaq: MGIC; TASE: MGIC), and Sapiens International NV (Nasdaq: SPNS; TASE: SPNS), as well as nextSource Ltd. Matrix IT has a market cap of NIS 615 million, Magic Software has a market cap of $41 million, and Sapiens has a market cap of $21 million.
Formula opened on Nasdaq today at $7.03, giving a market cap of $92 million. The share rose 3.8% on the TASE to NIS 28.22.
Published by Globes [online], Israel business news - www.globes-online.com - on July 7, 2009
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