For investors looking for more exposure to Israeli startups, a built-for-purpose initial public offering (IPO) has arrived on the scene.

Israel Acquisitions Corp. is preparing to go public, albeit at a smaller scale than originally planned.  

The firm first filed with the Securities and Exchange Commission (SEC) on March 17, 2022. In its first iteration, the deal was to offer 20 million units at $10 each. Yet the firm later lowered the offering to 15 million units in a later S-1/A filing in August. Then last month, it revised that target again in a second S-1/A filing on November 22, placing the IPO at 12.5 million units, with the aim of raising $125 million in total.

The company has yet to announce a date for when its stock will be available on the market. It plans to launch on the NASDAQ under the ticker “ISRLU.”

Israel Acquisitions is a special purpose acquisition company (SPAC), also known as a “black check company”. SPACs have no assets or products of their own but are used as a fundraising vehicle for the purpose of taking over a profit-generating company at a later stage.  

In this case, Israel Acquisitions said it is targeting high-growth tech startups with a strong presence in Israel with a valuation between $800 million to $1.5 billion. 

The firm may be spoilt for choice. It believes there are hundreds of eligible Israeli pre-IPO tech companies that could be eligible. It is keeping its options open in terms of industry verticals but is keen on firms in cloud computing, cybersecurity, deep technology, e-commerce, electric vehicles, fintech, food-tech, agri-tech, gaming, quantum computing, as well as space.

Israel Acquisitions sees an entrepreneur and tech policy tsar combine forces, with the former founder of ad-tech startup Inneractive Ziv Elul acting as CEO and Israel’s former Minister of Science and Technology Izhar Shay as Chairman. The company was only founded last year and, despite its keen focus on Israel, is currently domiciled in the Cayman Islands. 

‘Scale-up Nation’  

Branding itself as the “startup nation,” Israeli tech has gained a lot of momentum in recent years. The country topped the World Bank’s charts for R&D expenditure as a share of overall GDP in 2020 and has already produced 100 Nasdaq-listed companies. 

Israeli entrepreneurs have made waves, whether it be Amnon Shashua, who founded Mobileye – one of this year’s top-performing IPOs – or WeWork founder Adam Neumann, whose dramatic fall from grace became the stuff of Wall Street legend. 

Israel Acquisitions hopes to uncover the next big winner and give it the capital needed to take it to new heights. It sees itself as fueling the next phase of Israel’s tech evolution. In its prospectus, it refers to a “rapid shift” from the “‘Start-up Nation’ to the ‘Scale-Up Nation.’” 

SPACs were all the rage during the pandemic bull market, with a whopping 247 launched in 2020 and a record-breaking 295 in 2021. Yet investors have cooled considerably on SPACs amid a broader market downturn this year. 

As Israel Acquisitions has yet to divulge a clear acquisition target, this IPO is a bet on the management’s keen eye for the Israel ecosystem and dealmaking acumen. Investors who join will be hoping Elul, Shay, and the team can bring a new unicorn to market.   

This article was produced and syndicated by Wealth of Geeks.

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