Sources inform ''Globes'' that Babylon Ltd. (TASE:BBYL) controlling shareholder Noam Lanir received a few days ago an offer for his holding from a foreign private equity fund at a price reflecting a substantial premium on the online translation company's market cap. The parties have opened preliminary talks, but not actual negotiations, said the source.
Most of Babylon's revenue comes from its share in Google Inc's (Nasdaq: GOOG) Adsense software. Babylon's share price rose 1.7% today to NIS 5.80, giving a market cap of NIS 248 million. The share price has risen 17% since the beginning of 2011.
Lanir and his partners acquired control of Babylon three years ago at a dividend-adjusted price of NIS 2.49. The current share price reflects a return on investment of around 130%. The company distributed NIS 47 million in two dividends since then, of which NIS 14 million went to Chanpak Managment Ltd., through which he controls the company.
Chanpak currently owns 22.7% of Babylon, worth NIS 56 million. The original holding shrank after some partners left Chanpak. Babylon's other large shareholders are Reed Elsevier Ventures 2004 Partnership LP, with a 19.7% stake; provident funds of Harel Insurance Investments and Financial Services Ltd. (TASE: HARL), with 6.5%; and Lanir-controlled Livermore Investments Group Ltd. (AIM:LIV), with 2.2%. IBI Investment House Ltd. (TASE:IBI) was a party at interest in the company until it sold a bloc of share in October 2010.
Published by Globes [online], Israel business news - www.globes-online.com - on January 18, 2011
© Copyright of Globes Publisher Itonut (1983) Ltd. 2011