After a 15.7% drop in its share price so far this year, and speculation that the company was for sale and seeking a buyer, Allot Communications Ltd. (Nasdaq:ALLT; TASE: ALLT) appears to have caught the eye of George Soros's fund Soros Fund Management, which was reported yesterday to have taken a substantial stake in the company.
A filing by Soros Fund management with the US Securities and Exchange Commission (SEC) shows that, earlier this month, it became a party at interest in Allot with a holding of some 2.2 million shares, representing about 6.6% of the company. The value of the fund's holding is currently $11 million. The fund's holding is a passive, financial interest and is not intended to influence the running of the company.
Other prominent shareholders in Allot are Zohar Zisapel, with an 8.6% stake, Fidelity with 8.3%, Migdal Insurance and Financial Holdings Ltd. (TASE: MGDL) with 7.8%, The Phoenix Holdings Ltd. (TASE: PHOE1;PHOE5), with 7.3%, and three additional financial institutions in the US with holdings of 5.6-6.5%.
Hod Hasharon-based Allot is dual listed on Nasdaq and the Tel Aviv Stock Exchange, with a market cap of $165 million. The company, run by president and CEO Andrei Elefant, provides security and monetization solutions. For several quarters it has struggled to recover from difficulties in its core DPI business (deep packet inspection - monitoring and management of applications traffic on the Internet), while its monetization and security business have failed to compensate for the decline in DPI. Allot recently announced a restructuring which, as far as is known, involved 30 layoffs.
Allot made its Nasdaq IPO a decade ago at a valuation of $250 million. At its peak, four years ago, it had a market cap of $875 million, since when its share price has declined 82%. Allot is believed to have held initial talks with prospective buyers.
Published by Globes [online], Israel business news - www.globes-online.com - on August 16, 2016
© Copyright of Globes Publisher Itonut (1983) Ltd. 2016