News

Chairman Ben-Shaul:The sale of the Scitex pre-print activity to Creo is not the end of Scitex, and there is no intention of selling the company’s activity. “It is a new beginning, and there is no intention to conduct a fire-sale for Scitex”.

Ben-Shaul: “No Intention of Scitex Fire-sale; Sale of Division to Creo – New Beginning By Keren Tsuriel “The strategic structure of Scitex has changed; it is becoming a specialized investment company, with investments in separate, focused companies, as favored by the capital market and new economy of the global village”. This was said today by Clal Industries general manager Rimon Ben-Shaul at a press conference, in which Scitex announced it was merging its pre-print activity with Canadian company Creo. Scitex in its new structure will focus on two fields: digital printing and Internet technology, with the goal of creating growth in its subsidiaries and value for its shareholders. Ben-Shaul emphasized that the sale of pre-print activity to Creo is not the end of Scitex, and there is no intention of selling the company’s activity. “It is a new beginning, and there is no intention to conduct a fire-sale for Scitex”, he said. Under the agreement, Scitex is selling its pre-print activity to Creo in return for 27% of Creo’s shares, fully diluted, which are worth $610 million. Since reports of the expected deal with Scitex, Creo’s share rose on the Vancouver stock exchange to $40, raising the value of the transaction from $537 million to $610 million. Creo president Amos Michelson noted that, on a pro forma basis, the results of the consolidated company for the four quarters ending in September 1999 show sales of $635 million and an operating profit of $60 million. The largest competitors of the new company, Creo-Scitex, in the pre-print field are Agfa, the volume of whose activity is estimated at $2 billion; and Dai Nippon Printing of Japan, with an activity volume of $500 million. Scitex general manager Yoav Chelouche said that Creo-Scitex jointly employ 4,200 staff, of whom 1,200 are in Israel. Chelouche emphasized that there is no intention to lay off Scitex employees following the merger. Published by Israel’s Business Arena on January 18, 2000

The acquisition, originally announced in November, will raise Clal’s stake in Scitex to 19.7 percent

Sunday January 9, 4:25 am Eastern Time Clal buys 6.6 pct of Scitex TEL AVIV, Jan 9 (Reuters) – Israel’s Clal Electronics Industries said on Sunday it had completed the purchase of a 6.6 percent stake in Scitex Corp from International Paper (NYSE:IP – news) for $40 million, or $14 a share. The acquisition, originally announced in November, will raise Clal’s stake in Scitex to 19.7 percent. Discount Investment Corp. is buying IP’s remaining 6.6 percent stake in Scitex for the same amount. Scitex, a maker of digital preprint and printing systems, closed at $14-5/8 on Friday on Nasdaq. Clal Electronics is a subsidiary of Clal Industries & Investments . Scitex share have been climbing up lately:

Efi has sold his third venture in California and is probably moving to New York. The Israeli paper Globes is trying to assess what’s now.

Efi Arazi – EFI

The Guru

by Efi Landau

Efi Arazi needs no introduction, either in Israel or overseas. Probably no ambassador is better known to Israeli high tech. He grew up in besieged Jerusalem during Israel’s War of Independence. After demobilization from the IDF, he lived in the US. At age 30, he already held a senior position in a high tech company. He was called to Israel in 1968 to found and manage Scitex, which developed preprinting computer systems.

In over 20 years at Scitex, Arazi brought the company to record peaks, but also experienced the fall of 1985-87. The company recovered, and Robert Maxwell entered as an investor, but Arazi was forced to resign.

Arazi left Scitex in 1988, and a year later in Silicon Valley founded Electronics For Imaging (EFII), which deals with color printing systems, with an investment of $14,000. Some years later, he cashed in his investment at a profit of $55 million. The company is currently valued at $3 billion, has yearly sales of $500 million, and its 1999 profit is expected to near $100 million.

Arazi’s third project was less successful, although he made a not insignificant profit from it. Imedia was founded in 1994, after its founders developed a product in the field of digital video compression. A few months after the company’s founding, Efi Arazi joined the enterprise and began managing it. A rosy future was forecast for the company, with a future value in the hundreds of millions, or even billions, of dollars. In the end, the company was sold this July to US company Terayon Communication Systems, which is controlled by the Rakib brothers, for $100 million in Terayon shares.

Arazi is currently sitting on an unknown number of shares in Terayon, which acquired Israeli companies Telgate and Radwiz a month ago, testing ideas. At age 63, his fame as a high tech entrepreneur precedes him wherever he goes. It is said that Arazi replaces his wives at the same rate that he replaces his companies. He is now living with his fourth wife, but still has not picked a fourth company, so there is something to look forward to.

Published by Israel’s Business Arena on December 13, 1999

Scitex Is in Talks to Sell Two Units, to Creo and NUR (?)

Monday , Dec 13, 1999 Sun-Thu at 18:00 (GMT+2) High Tech News Scitex Is in Talks to Sell Two Units, Report Says By Bloomberg Scitex, an Israeli maker of digital printers, is in talks to sell two of its main units, Yediot Ahronot reported, citing unidentified sources. The company plans to sell part of its digital printing business to Canada’s Creo Products for about $400 million, the newspaper said. Also, the company is in talks to sell its wide-format color printers unit to Nur Macroprinters, which makes competing products, in exchange for shares. Last month, Scitex said three of its biggest shareholders agreed to acquire the 13.3 percent stake owned by International Paper, the No. 1 paper maker, for $80 million.

From: IsraelInvestor.com How the cruel stock market is killing Israel high tech legend: an insight view of a long-term Scitex share holder.

Shlomi Cohen 12/24/1999 14:55

From: IsraelInvestor.com

How the cruel stock market is killing Israel high tech legend: an insight view of a long-term Scitex share holder.

My heart with Scitex managers that six months ago invited me, along with leading analysts from all over the world, to 10 hours of presentations on Scitex state of the art technologies and shining future.

From all that I heard during that day, I now recall what Itai Halevy, Corporate Vice President, said when I asked him to react on the endless rumors about Scitex being a target for a long-expected takeover. Itai said: “We, the managers of Scitex, still believe that we can make Scitex the Israeli NOKIA,” he honestly replied.

My heart with Itai and the other outstanding managers that presented Scitex to the analysts at that day and are now watching how the new Chairman, Rimon Ben Shaul, is slashing Scitex to pieces. This brings back another memory, of Efi Arazi, Scitex founder, who once described what Davidi Gilo (founder of DSP and DSPG) was planning to do to Scitex: “slash it and sell its pieces the same as spare parts are sold in Gaza marketplace”. To those of you who do not remember – Efi was commenting on Davidi’s takeover proposal way back in April 1996. A takeover that was never concluded because Scitex’ leading share holders, Clal and DIC, declined Davidi’s offer for up to $25 a share.

Soon Scitex will be sold in parts as a victim of the cruel stock market. In days when a company like Sensar (SCII) is evaluated at $400m just because they appointed David Rubner from ECI as a Chairman (no sales yet), Scitex with more than $700m in annual sales , is not getting a much higher evaluation in this sky rocketing market.

Let me try to guess in the following lines how Scitex owners are planning to maximize the value of the parts:

The Digital Pre-Print will go to Creo (CREO) for $500m against Creo stocks that later will find their way directly to Scitex shareholders. By selling to Creo, Scitex employees will find themselves working for a longtime competitor, Heilderberg from Germany, who partnered with Creo.

Karat unit, with its 74 Karat-Digital Offset Press will go to the 50% partner KBA from Germany. I guess that KBA more than unhappy to see the link between Scitex and their biggest competitor, Heilderberg.

From the existing Digital Pre-Print Division, my guess is that Iris Proofers will be taken out of the deal with Creo. This unit will probably be sold to other proofer manufacturers, like Imation (IMN) once part of 3M (MMM).

Scitex Digital Printing (SDP) from Dayton Ohio, will finally be sold to Xerox. Xerox, with a series of warnings lately, needs this business (and especially the VersaMark Book Printer) in order to place more new products in the market.

Xerox will also buy the small unit (located in Israel) that on an exclusive contract with Xerox, develops and manufactures the DFE – Digital Front End. Scitex DFE will help Xerox with their next generation high end color digital printer, that is planned to be launched next year and is supposes to bring Xerox back to a growth route.

As already has been discussed in the press, the Wide Format Printing will be merged with Nur Macroprinters Ltd. (NURM), an Israeli-based successful competitor.

VIO, the Scitex and British Telecom Joint Venture will find it ways to the benefit of Scitex shareholders to an Internet IPO sooner or later as VIO.COM….

What is yet left to be seen is whether this auction will bring us, Scitex shareholders, the same price of $25 that Davidi Gilo offered four years ago

Clal will be buying IP shares. No comment on any specific plans Clal and Discount have for Scitex or whether there will be any managerial changes.”There is an expectation that already in 2000 the company will show recovery…”

Israel’s Discount Investment Corp and Clal Electronics said on Wednesday they would buy International Paper’s 13.2 percent stake in Scitex Corp for a total of $80 million. IP had invested in Scitex $210M several years ago. Under the terms of the deal, Clal and Discount, along with its wholly owned subsidiary PEC Israel Economic Corp, each agreed to buy 6.6 percent of Scitex for $40 million, or $14 per share. Scitex closed at $12-7/16 on the Nasadaq on Tuesday. Upon completion of the deal Clal will own 19.7 percent of Scitex while Discount and PEC will together own 19.9 percent, the companies said. He declined to comment on any specific plans Clal and Discount have for Scitex or to say whether there would be any managerial changes. Analysts said the deal was positive for Scitex and was expected to drive up its share price in coming days. “It is obvious that Clal believes that Scitex is on the right track and undervalued at the current price,” said an analyst familiar with the company.

Scitex Announces Third Quarter 1999 Results. Finally, a double-digit revenue growth. Rimon Ben-Shaoul, Vice Chairman, was elected Chairman of the Board of Scitex Corporation Ltd., succeeding Mr. Dov Tadmor who announced his retirement

Herzlia, Israel, October 27, 1999 Scitex reported net income for the third quarter of 1999 of $5.1 million or $0.12 per share (diluted), compared to a loss of $78.7 million or $1.83 per share for the third quarter of 1998. Third quarter 1998 results include a $68.9 million loss from discontinued operations. Revenues for the third quarter of 1999 were $167 million, up 11% from the $150 million recorded in the third quarter of 1998. Scitex also announced that Rimon Ben-Shaoul, Vice Chairman, was elected Chairman of the Board of Scitex Corporation Ltd., succeeding Mr. Dov Tadmor who announced his retirement. Mr. Ben-Shaoul, CEO and President of Clal Industries and Investments Ltd., The disenchanted investors hope now, that this historic and long over-due change at the helm may open up new opportunities for a faster growth, or sale of the company.