The circumstances in which a public company, in contrast to a private investor, sells its holding in another public company are quite rare for Israeli companies listed on Nasdaq. The reason is that in most cases, ownership of Israeli companies is quite dispersed and shared among a great many shareholders, mostly venture capital funds and US institutional investors.
The situation is rather different for AudioCodes (Nasdaq: AUDC; TASE:AUDC). In addition to its two founders, chairman, president, and CEO Shabtai Adlersberg and director Leon Bialik, who own 25% of the company's share capital, DSP Group (Nasdaq: DSPG) also has an 11.9% holding. DSP Group became an AudioCodes shareholder when it invested in the company during its early years. Adlersberg and Bialik were also founders of DSP Group.
Like many parties at interest that have recently decided to exploit the bull market to convert shares into cash, DSP Group has decided to sell a part of its AudioCodes holding. This is quite understandable, given AudioCodes' 455% rise in the past year. A document filed with the US Securities and Exchange Commission (SEC) on Friday reveals that DSP Group sold one million AudioCodes shares for $11.3 million between January 2 and 7, reducing its stake to 3,450,672 shares, or 9.17% of the company's share capital. DSP Group sold the shares at between $10.59-13.05 a share.
The sale was DSP Group's first transaction in AudioCodes shares in three years. In 2000, DSP Group bought 300,000 AudioCodes shares and sold 1.7 million shares, reducing its holding from 15.23% to 11.12%. In 1999, DSP Group sold 2.6 million AudioCodes shares and bought one million, reducing its holding from 29.2% to 15.23%.
DSP Group is not the only party at interest in AudioCodes that decided to sell part of its stake. Leon Bialik sold $2 million worth of shares during 2003. DSP Group and Bialik sold shares after AudioCodes' share rose 455% in the past year to $15 a share, reflecting a market cap of $550 million.
AudioCodes, a developer of VoIP equipment, lost $1.6 million ($0.04 a share) on $11.8 million in revenue in the third quarter of 2003. The company expects revenue to increase by at least 10% in the fourth quarter (i.e. at least $13 million) and a per share loss of $0.04-0.05.
DSP Group develops digital signal processors for advanced communications applications. Its current share price of $26.20 reflects a market cap of $751 million.
Published by Globes [online] - www.globes.co.il - on January 12, 2004