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Israel seeks managers for state-backed technology funds
July 9, 2017 / 12:25 PM / 3 months ago

Israel seeks managers for state-backed technology funds

JERUSALEM (Reuters) - Israel is looking for firms to manage four high-tech investment funds that will be traded on the stock exchange and given state protection for any losses, the government said on Sunday.

Israel’s government has been under pressure to open the country’s thriving technology sector to more local investment as foreigners are seen to be mainly reaping the returns of Israel’s tech boom.

Most of the capital invested in Israeli companies is in research and development and many firms are acquired by foreign ones at relatively early stages.

Last week, Symantec Corp said it was buying Israeli cybersecurity startup Fireglass, while earlier this year Intel agreed to buy Israeli autonomous vehicle tech firm Mobileye for $15 billion. In 2013, Google bought Israeli mapping service Waze for some $1 billion.

The government will put out to tender on Sunday the management of the two new investment funds, the Finance Ministry and Israel Securities Authority (ISA) said in a joint statement.

Up to four managers will be selected for the funds, which will each have a minimum of 400 million shekels ($113 million), they said.

The funds will combine investments in tech stocks that are already traded, while at least 30 percent will be made in early stage startups, enabling investors -- including institutions -- to benefit from returns in the tech sector in a relatively secure manner, the statement said.

For each fund, the government will provide guarantees of up to 50 million shekels ($14 million). The funds will also be able to raise credit backed by the state of up to 100 million shekels.

“Our proposal is intended to create an investment instrument for the general public that will enable it to participate for the first time in the success of Israeli technology companies, while providing state protection,” said Shmuel Hauser, chairman of the ISA, Israel’s markets regulator.

($1 = 3.5376 shekels)

Reporting by Steven Scheer; Editing by Elaine Hardcastle

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