Israeli private equity firm FIMI Opportunity Funds is acquiring a 62.5% stake in E&M (Emet) Computing Ltd. (TASE:EMCO) for NIS 450 million at a company valuation of NIS 720 million. The deal will be completed if certain contingency conditions are fulfilled within 90 days.
FIMI, founded by CEO Ishay Davidi, is paying NIS 16.25 per share, a 9.7% discount on yesterday's closing price. E&M's share rose 4.4% in 2020 and is up 31.4% since the start of 2021. Following the announcement, the share price has risen an additional 30% in trading today.
The sellers are company veterans including former chairman Yigal Shefer, who is selling shares for NIS 66.9 million, current chairman Shraga Shahak is selling shares for NIS 71.6 million, and board members Reuben Schrift is selling shares for NIS 84.5 million, Jacob Walter is selling shares for NIS 129 million and Sarah Shahak is sellng shares for NIS 68.2 million. CEO Yoav Weinberg is selling shares for NIS 29.7 million. FIMI senior partner Gillon Beck will become the company's new chairman.
In the first nine months of 2020, E&M's revenue was NIS 995 million, down 2.8% from the corresponding period of 2019, while net profit rose 21% to NIS 28.6 million. The company has 22 subsidiaries and five production sites in Israel and the US with 1,100 employees. Customers include government offices and major companies in Israel and abroad.
Beck said, "The investment in E&M Computing is a continuation of FIMI's strategy of identifying companies with high growth potential, including in the IT sector. E&M has unique knowhow in the computing infrastructure sector and providing business computer and technological solutions and is considered a leader in its field. I am convinced that together with the company's management combined with our knowhow and experience in enhancing companies, we will grow the company in the local and global markets."
Published by Globes, Israel business news - en.globes.co.il - on January 28, 2021
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