It is not just startup companies that are exposed to the collapse of Silicon Valley Bank (SVB). Several Israeli public companies traded on Wall Street and/or in Tel Aviv have already released statements on the matter.
QualiTau (TASE: QLTU), which specializes in semiconductor testing and is traded on the Tel Aviv Stock Exchange at a market cap of NIS 155 million, has reported exposure to the bank. According to the report, it held $16.8 million of its total cash of $22.3 million at SVB. QualiTau says that, as far as it is aware, only the sum of $250,000 is guaranteed by Federal Deposit Insurance Corporation (FDIC). "The company has no information about the sums of money that it will be possible to withdraw in the future out of the cash balances deposited or about when it will become possible to withdraw this money," QualiTau said.
The company instructed all its customers to stop making payments into its SVB account, and added that it "is taking and will take various steps to minimize the effect of the event on the cash flow required for the company’s continued operation." QualiTau says that despite the material effect on its assets, thanks to its other cash balances, its orders backlog, and the absence of substantial liabilities, it is capable of continuing its operations in the normal course of business.
QualiTau's share price is down 12% on the Tel Aviv Stock Exchange.
Web content recommendation company Outbrain (Nasdaq: OB), which has a $220 million market cap on Nasdaq, has cash and a credit line at SVB. Outbrain has released a statement saying "Less than 5% of our current cash, cash equivalents and investments in marketable securities is held by SVB with the balance being held at multiple, large financial institutions. We also have an undrawn revolving credit facility with SVB, and the company does not foresee any near-term needs to draw upon this facility. SVB is also the counterparty to our forward foreign currency hedge contracts. We do not anticipate a material impact on our financial condition or on our operations."
At the end of 2022, Outbrain had a total of $351 million in cash and short-term investments.
Computerized drug design company Compugen (TASE: CGEN; Nasdaq: CGEN) also has some exposure to SVB: 1.3% of its cash and cash equivalents are deposited at the bank. The company describes its exposure as immaterial.
Other companies have yet to report on their exposure to the bank, but have previously reported credit lines from SVB. Fintech company Pagaya Technologies (Nasdaq: PGY), for example, reported a few months ago that it had secured a new credit line of $167.5 million from the bank. As far as is known, the company has not drawn on the credit line, and it does not have a substantial sum deposited at SVB. Video solutions provider Kaltura (Nasdaq: KLTR) also has a line of credit at SVB, according to earlier reports.
Air purification technology company Aura Smart Air (TASEW: AUSA) has an indirect connection with SVB. The company recently announced its sale to US company Molekule Group (Nasdaq: MKUL). Molekule Group has a loan agreement with SVB (which, according to earlier reports, amounts to $34.4 million), and requires SVB’s approval for the deal with Aura Smart Air, although the consideration is in shares and bank finance is not needed.
SVB’s Israeli website lists names of companies that the bank says are its customers, among them public companies WalkMe (Nasdaq: WKME), Similarweb (NYSE: SMWB), and Tremor International (Nasdaq: TRMR).
Other Israeli companies have reported that they have no exposure to SVB. Among these are Valens Semiconductor (NYSE: VLN), which provides semiconductors for the audio-video and automotive industries, and biopharma company PolyPid (Nasdaq: PYPD).
Published by Globes, Israel business news - en.globes.co.il - on March 12, 2023.
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