The former Minister of Science and Technology expresses confidence in the declining trend of SPAC issues on Wall Street. Hundreds of SPAC companies that have raised money in the past year and a half and are looking for destinations to purchase, are expected to be joined soon by another company, which focuses on Israel.
Israel Acquisitions Corp. has submitted a prospectus to raise $ 200 million on NASDAQ, with the intention of finding a company to acquire in the Israeli technology industry. Although the company is registered in the Cayman Islands, it is led by Israelis, led by chairman Yizhar Shai Served in the position between May 2020 and January 2021) Known as a high-tech entrepreneur and venture capitalist.
Shai will be led by SPAC CEO Ziv Elul, who ran the digital advertising company Fyber until it was sold last year for $ 600 million.
The SPAC board of directors includes Roy Zisapel, CEO of Radware, and Daniel Recanati, founder and CEO of the Rhodium Investment Fund.
SPAC companies are inactive companies that raise money on the stock exchange in order to acquire an existing company within a limited period of time, or will be forced to return the money to investors. For private companies, merging into SPAC companies is an alternative way to get to the stock market, instead of through an initial public offering (IPO).
Still looking for destinations to purchase
SPAC issues were a major trend on Wall Street between mid-2020 and the beginning of the second quarter of 2021, but have since cooled significantly, in the face of new accounting guidelines that have made it difficult for SPAC mergers, disappointing results of merging companies and their share returns Caused concern about investing in new companies merging with SPAC.
However, a large number of SPAC companies that have already raised money are still looking for destinations to purchase, among them that have been pre-defined as those looking for destinations to purchase in Israel. These companies include Moringa, led by Ilan Levin, who raised $ 100 million, BYTE, led by Danny Yemin and Kobi Rosengarten, who raised $ 300 million, Bridge 1, by Ezra Gardner and Omri Charney, who raised $ 115 million, Finnovate, led by David Gershon, Ron Golan and Yonatan Ofir, who raised $ 150 million, and ION Acquisition Corp 3 by Yonatan Kolber and Gilad Shani, who raised $ 253 million, having previously issued two SPAC companies, which have already completed mergers with Tabula and Innovid.
The Israel Acquisitions Corp. prospectus states that “the technology industry as a whole has experienced unprecedented growth growth during the COVID-19 epidemic, as more businesses have adopted new and innovative ways of doing business, and more consumers are rapidly adopting digital platforms to consume products and services.”
Dramatic growth in the number of unicorns in Israel
In their estimation, “the technology sector in Israel reflects a concentration of value, with a large number of companies growing rapidly.” They add that the number of unicorns (private companies with a value of over a billion dollars) in Israel has grown dramatically, and already constitutes 10% of the unicorns in the world – as of June 2021, in Israel there were 70 out of 700 worldwide.
The SPAC will look for companies with a value ranging from $ 800 million to $ 1.5 billion, those that have a strong backlog of orders, and are growing rapidly, and can, in its estimation, accelerate growth thanks to exposure to public capital.
Israel Acquisitions Corp. estimates that there are currently hundreds of Israeli technology companies in the pre-IPO stage, which could be a target for acquisition, and the number is expected to grow.
The company is expected to focus on areas that its people believe have attractive growth opportunities, but it points to a wide range of areas: cloud computing, cyber security, deep technology, online commerce, electric vehicle technology, energy technology, fintech, food or agriculture technology, gaming, computing Quantum and the space and satellite industry. According to them, the SPAC team has extensive experience in identifying growing companies and in making strategic investments, as well as in creating value after the transactions have taken place.