The merger of 3D printer developers Objet Ltd. and Stratasys Inc. (Nasdaq: SSYS) has created a $1.4 billion company, and has further enriched some Israeli and Jewish millionaires.
Stratasys's market cap was $877 million at yesterday's close, after Wall Street investors boosted the share 15% to a 12-month high of $41.21. The share price continues to rise strongly today. The jump is unusual - shares usually fall following a merger announcement on investors' concerns that their holdings will be diluted. Stratasys's current market gives the merged company a value of $1.6 billion, which gives Objet a derived value of $726 million, up from $634 million on the day of the announcement. The figure is quite respectable for a company that had planned to hold an IPO at a maximum value of $500 million.
Most of Objet's new millionaires are unknown; their names mean little to the public, forcing searches on Google and in the "Globes" archives.
The party making the biggest profit from the merger is Samson Capital, a subsidiary of US private equity firm Samson Capital Advisors LLC, which owns 27.6% of Objet. Its shareholders include Roy Zuckerberg 71.4%, Allen (Elchanan) Jaglom (7.4%), and his cousin Michael Jaglom (18.5%). Another Objet shareholder, Hancock, with a 3.4% stake, is owned by Jaglom and Zuckerburg, with 56.2% and 43.8% stakes, respectively. Zuckerburg also owns a third company that owns 0.3% of Objet.
Roy Zuckerberg, who is apparently not related to Facebook's founding family, is the biggest winner from the Objet-Stratasys merger: his indirect 22.2% stake in Objet is currently worth over $162 million, following the jump in Stratasys's share price.
Since Objet raised $28 million, investors are making a 26-fold return on their investment.
Roy Zuckerberg, 74, is a former investment banker and vice chairman at Goldman Sachs Group Inc. (NYSE: GS), a Jew who lives in New York and loves Israel. He has no position at Objet. He left Goldman Sachs in 1998, after 32 years at the company, although he is still a director. He served in the US Army. Ben Gurion University of the Negev awarded him an honorary doctorate three years ago for his philanthropy for the university.
Elchanan Jaglom, 70, resides in Switzerland, and his affinity for Israel is even stronger than Roy Zuckerberg's. He indirectly owns 3.9% of Objet, worth $29 million. He is a scion of one of Israel's wealthiest families, and was active in the Israeli capital market in the early 1990s. The family controlled real estate company Ocif, before it was sold to the Aviv family. His mother, Raya, was chairwoman of WIZO, and he is a trustee of the Tel Aviv Museum of Art, which displays part of the family's art collection, and of Ben Gurion University.
Jaglom has been involved with Israeli high-tech printing companies for many years, starting out as a director in Idanit Technologies, which was acquired by Scitex Digital Printing, which in turn was acquired by Hewlett Packard Co. (NYSE:HPQ).
Objet CEO David Reis, 50, owns 4.2% of the company, including options, worth $30 million. He has worked for the company for three years. Although his and other shareholders' profits are only on paper, but if they decide to sell shares following the closing of the merger, assuming no profit taking at Stratasys in the interim, they will make real money.
Published by Globes [online], Israel business news - www.globes-online.com - on April 17, 2012
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