Israeli entrepreneurs are world renowned for their high tech talents and ingenuity. Funding has always been the problem. But now Israeli cleantech start-ups may finally be getting the financing they need.
$7.7 billion market cap investment fund, Blackstone, also the world’s largest private equity fund, began holding advanced talks with Israeli fund Markstone in February on entering the Israeli market. The two have since created a joint venture that will invest hundreds of millions in the Israeli market, much of it in the cleantech sector.
The fund has already begun to raise capital via investments to Blackstone and Markstone, with a focus on large-scale investments of anywhere from $100 million to $1 billion in investment. Once the money is raised, Blackstone is planning to invest in what is increasingly being seen as a strategic foreign market. And some Israeli companies have already been developing internationally, boosting economies in other countries as well.
But for Israel, drawing such a major international investor is a significant milestone that will undoubtedly have long-lasting ramifications on the country’s economy and the strategies the government employs to manage the increasing amounts of capital that are flowing into the country from the energy sector. And with billions of dollars expected to coming in from the new natural gas wells in the Mediterranean, a significant flow of cash to cleantech and IT can help Israel stay focused on renewables and green energy.
It is still uncertain which companies will win the first round of investments from the new Markstone-Blackstone fund, but according to Ynet the lucky companies may be Partner Communications, Cellcom and Clal Industry, all companies traded on the Tel Aviv stock exchange.
The news that Markstone’s managing directors Dan Gillerman, Amir Kess and Ron Lubash were negotiating with Blackstone was first broken by Israeli financial blog Calcalist. The three will directly manage the fund for Blackstone once money is invested directly in the Israeli market.
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