Discount Investment Corporation Ltd., an Israeli holding company, has announced its intention to potentially divest its entire stake in Elron Ventures, a prominent Israeli venture capital fund. The company is currently in discussions with a foreign venture capital firm regarding the sale, with negotiations underway to sell Discount Investment’s 59.14% holding in Elron for an estimated $48.5-$53.2 million. This valuation would place Elron Ventures at an estimated worth of $82-$90 million.
Elron Ventures specializes in early-stage investments in sectors such as medical devices, cybersecurity, and software. The potential sale reflects Discount Investment’s strategic decision to reallocate its investment portfolio and capitalize on emerging opportunities in the venture capital landscape.
The proposed deal is contingent upon various factors, including the maintenance of Elron’s current financial position, cash levels, and working capital. However, any adjustments to the valuation will be made in light of potential dividend distributions by Elron. Notably, Elron has recently obtained court approval to distribute a dividend of $35 million, which may impact the final sale terms.
This development follows Discount Investment’s recent divestment of its stake in telecom company Cellcom Israel Ltd. in December 2023, indicating the company’s ongoing efforts to streamline its investment portfolio and pursue strategic transactions to unlock value for shareholders.
