After leaks last month about the imminent deal, this afternoon Israeli cloud security company Wiz confirmed that it is to acquire Israeli cybersecurity company Gem Security for $350 million in cash. Gem Security was founded less than two years ago.
The deal means that Israeli investment fund Team8, one of the main investors in Gem Security, has recorded three exits of companies totaling $1.1 billion in the last five months - the other two companies - Talon and Dig Security were sold to Palo Alto Networks for $457 million and $295 million respectively. Team8 is estimated to hold between a quarter and a third of the companies' shares, earning it about $300-350 million. No wonder Team8 was able to raise about $500 million last month for a new fund.
Team8's senior figures include former IDF 8200 unit commander Nadav Zafrir, former Bank Leumi CEO Rakefet Russak Aminoach and the experienced CFO Sarit Firon. The latest exits end a long period of selling companies at low to average prices. In recent years, Team8 has been forced to sell promising cybersecurity companies such as Illusive Networks, Hysolate and Spot for modest prices. In fact, the highest exit registered by the fund was also the first company it sold back in 2018, Sygnia, from which some of the founders of Gem Security left.
In addition to Team8, the big winners from the Gem Security deal include the founders Arie Zilberstein, Ron Konigsberg and Ofir Brukner, who hold about 50% of the company's shares, according to estimates, while US fund Notable (formerly GGV) was one of the first investors. Other investors who will record positive returns include the investment funds of Intel and Cisco, as well as SVCI.
Estimates are that Gem Security still had millions of dollars in its coffers from the $23 million that it raised last September so that the investors will receive some of their money back as part of the overall exit.
Published by Globes, Israel business news - en.globes.co.il - on April 10, 2024.
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