2018 report for M&As in Israel by PwC
(Source: https://en.globes.co.il/en/article-pwc-exits-down-33-in-2018-1001266956)
We have a preconceived that talking about Israeli startups, high-tech industry is the symbol but the report from PwC shows that low-tech industry succeed in M&A more than tech or life science industries. The total volume of M&A deals increased by 77% from $12.2 billion in 2017 to $21.6 billion in 2018, according to the report. PwC said that Israeli economy would reach its peak with their startup ecosystem. The report was surveyed except for the huge M&A deals evaluated more than $15 billion such as Mobileye by Intel and Actavis by Teva Pharmaceutical Industries Ltd. The average valuation of each acquisition increased by 88% to $267 million in 2018 but the number of deals declined steadily from 131 in 2017 to 124 in 2018. In the life science industry, the total volume of M&A deals decreased sharply from $4.7 billion in 2017 to $1.3 billion in 2018.
On the other hand, PwC report shows that 33% decrease in the number of M&A deals in high-tech industry compared with 2017. In 2018 61 Israeli high-tech companies succeeded in exit and the sum was $4.9 billion according to the report. The average valuation of each deal was around $81 million, compared to an average deal size of $106 million last year. The US tax regulation was reformed to keep their money in the US but acquisitions by US companies increased from $3.7 billion to $12.9 billion this year. The number of deals from East Asia stabilized, but the valuation of the each deal declined. PwC said there’s a possibility that the unstable financial markets and slowdown in world growth will have a negative impact on deal valuations in 2019. Moreover, there is a change in the mood among local entrepreneurs, who prior long-term management to a quick exit.
(Sources)
Globes - Israel Business News
https://www.timesofisrael.com/israeli-tech-exits-decline-as-ecosystem-matures-global-uncertainty-weighs/
