On Sunday afternoon, the flagship of Benny Landa’s group of companies, Nes Tziona-based Landa Digital Printing (LDP), filed a request for a stay of proceedings, because of the decision by its European investors to stop injecting capital and extending loans. This is the fourth company connected to the veteran entrepreneur that has got into financial difficulties since the outbreak of the Swords of Iron war, the first three being lab-grown diamonds company Lusix, cleantech company GenCell, and Highcon, a developer of post-print processes in the folding carton and corrugated carton industry.
What happened to the group of companies of the gifted mechanical engineer from Nes Tziona, one of the most active investors and entrepreneurs in Israel’s technology sector, who devoted his life to building up industry in Israel?
On the face of it, there is no connection between the various companies, some of which are considered leaders in their fields and admired as having breakthrough technologies, apart from the fact that Landa is a shareholder in all of them. The companies are not controlled by him but by different groups of investors, and Gencell and Highcon were not even founded by him in his group of companies, but rather he is an external investor in them, albeit a dominant one. So is it just a run of very bad luck that has hit Landa’s network of companies, or is there a common thread?
Costly deep-tech investment
Landa Digital Printing raised $1.3 billion over more than a decade in order to develop the only printer in the world that prints using nanometric ink, which does not wrinkle or wet the page. The printer is one of the most expensive in the world, costing $3-3.5 million. Despite the immense technological achievement and the delivery of about 50 orders, the business is a costly miss. In its request for a stay of proceedings, the company revealed debt totaling NIS 1.7 billion, of which NIS 1.4 billion is in the form of convertible loans that can be turned into equity if the company is sold. The company also owes some NIS 300 million to its employees, suppliers, and banks. LDP has shrunk from some 600 employees to about 400, and intends to continue downsizing to 250 employees, of whom 150 will be in Israel.
The company is nevertheless encouraged by its sales figures and its market positioning, and is confident that it will recover, or be sold for a decent price. Among the potential buyers is HP, which bought Indigo from Landa 24 years ago, and other companies such as Epson, Xerox, Brother, Agfa, and Fuji are also reportedly interested. Japanese bank Nomura has been appointed to find a buyer, which hints at an approach to the Asian market.
This is a sad chapter on the story of a company billed as the next big promise of Benny Landa, who is remembered as the person who sold Indigo to HP for almost $900 million.
Of the other companies associated with Landa that have recently run into difficulties, Lusix is the only one to have been sold, for just $4 million, after raising a total of $150 million. Highcom also filed for a stay of proceedings, and Gencell, whose share price fell 98%, has embarked on a downsizing program.
Landa has amassed wealth in the hundreds of millions of dollars thanks to the registration of about 1,000 patents in the field of digital printing, and instead of becoming a private investor or an investor in a venture capital fund, he sought to fulfil a dream: to set up new Israel heavy industry companies on the Indigo model through solving difficult problems requiring huge investment in laboratories and the hiring of scientists. Some of these companies were grown in his Landa Labs, and after proof of concept raised capital from external investors became independent.
Suffering from the same problem
All the companies that have got into financial difficulties have taken on difficult challenges requiring the investment of hundreds of millions of dollars in each in order to overcome them. LDP and Highcon deal in very expensive printers, but promise maximum quality. As mentioned, LDP offers high-quality printing using nanometric ink, while Yavne-based Highcon promises the fastest and best quality cutting of packaging in the industry, at a price of $1.5-2.5 million per machine.
Both companies suffer from the same problem: a slow process of development, sales and production. Customers generally have to come to Israel to gain an impression of the product and to buy it, something that has become almost impossible since October 7 2023. Continuous maintenance is also required for seven to nine years, and many customers were concerned that the war would prevent the Israeli companies from providing reliable service. Recognition of revenue is not immediate: it stretches over years, like a leasing plan, which in the end undid the balance sheets of the two companies.
Lusix too was founded with a revolutionary idea but one costly to carry out: a chip that absorbs heat from the environment and converts it to electrical energy, enabling it to power any electrical device, apparently in contravention of all the laws of thermodynamics. After research into its feasibility failed, the company discovered that the process generated a by-product in the form of pure laboratory diamonds, but after it gambled and invested in the development of machines and constructing expensive factories in Israel, the world market was flooded with synthetic diamonds from India. Last year, Lusix filed for a stay of proceedings, and, as mentioned, was sold after a few months.
Conservative investors
Another thing that the companies have in common is Landa’s choice to surround himself with conservative European investors, contrary to the norm in Israel’s technology sector, where venture capital and private equity firms from the US are generally preferred. The choice was not illogical: these are investors with the stamina to invest in the printing industry and other heavy industry, not something easy to find in Silicon Valley or New York.
In retrospect, however, it was a poor decision, because these are entities mostly connected to consumer brands that wanted to distance themselves from Israel because of the continuing war in order to avoid a boycott of their own products.
In the case of LDP, it was two of the foremost families in the continent’s financial aristocracy: the investment arm of German billionaire Susanne Klatten, which holds BMW, and has a 45% stake in LDP; and Winder Investment of the Rausing family of Sweden, owners of Tetra Pak, which has a 10% stake. "During the Gideon’s Chariots operation in the Gaza Strip, these families decided that they had had enough, and that they could not continue to support the company, because of the fear that this would taint their brands," a source familiar with the company says. He added that they had supported the company after October 7, and had even rushed to inject funds after a missile hit its premises, "but the continuation of the war led then to give up." Landa brought in luxury brands corporation Moët Hennessy Louis Vuitton SE (LVMH), which became the controlling shareholder in Lusix, and German companies Schumacher Packaging and Koenig & Bauer into Highcon.
Last year’s Drupa printing technology event in Germany was supposed to be a high point for LDP and Highcon. The first invested $10-15 million and the second $700,000 in marketing at the event, but the war had a negative impact on both. LDP received just eleven orders (it had expected sixteen), and Highcon too found the event disappointing.
Landa himself has not been free from mistakes. Employees at the companies describe huge investment in equipment, offices, and hiring people, sometimes even before it was clear that the companies were completely attuned to the market. Some employees talked of "profligacy" or "hubris". For example, Lusix built at its offices one of the world’s largest and most sophisticated vaults for diamonds, and it now stands empty. Others see this as Landa’s way of investing more than the average in his workers, seeing them as the most important resource in his group of companies.
The employees appreciate Landa for having put his hand in his pocket several times to save his companies, and in the case of Lusix he did so in order to pay workers’ salaries after it became clear to him that the legal process would not allow this. Nevertheless, in LDP, Lusix, and Highcon, Landa is completely diluted, and the companies were controlled by the European investors when they filed for protection from their creditors.
A final point: the group has never received aid from the state. Highcon did apply for aid from the Innovation Authority, but was refused, and remains in the position of a stay of proceedings until as buyer is found.
Published by Globes, Israel business news - en.globes.co.il - on July 1, 2025.
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