News Analysis – February 2017

News Summary

Euphoria Lost

The great expectations with which Israeli right, including key members of Prime Minister Benjamin Netanyahu’s ruling coalition, greeted Donald Trump’s election last November seems to have eroded on the eve of Netanyahu’s mid-February visit to Washington. Statements like that of Education Minister Naftali Bennett, leader of the religious nationalist Bayit Yehudi (Jewish Home) party that “the era of a Palestinian state is over,” expectations that Trump would quickly move the U.S. embassy from Tel Aviv to Jerusalem, as he stated early following his election, have been replaced by caution, or even apprehension, as the new administration’s Middle East policy begins to take shape.

The first let-down came shortly after Trump’s inauguration, with statements that the embassy move wasn’t going to happen in the immediate future, and would only take place after consultations with Washington’s other regional allies, including Jordan and Egypt. And Trump, in an early February interview with Israel Today, said he was still “thinking about the embassy” (question), saying it wasn’t “an easy decision.” In itself, that wasn’t much of a surprise; previous incoming U.S. administrations, including those of Barack Obama and George W. Bush, also backtracked from campaign promises for an embassy move.

Some of the right’s other optimistic assessments have also lost air. First came a White House statement saying that while it didn’t consider settlements “an impediment to peace,” construction of new settlements or expansion of existing ones “may not be helpful in achieving that goal.” That was followed up with Trump’s statement in the Israel Today interview, where he said that settlements “don’t help the process” and “I am not somebody that believes that going forward with these settlements is a good thing for peace,” adding that he would not, as Obama did, condemn settlement construction outright.

Nor are Bennett and his allies both in his own party and Netanyahu’s ruling Likud expressing confidence about the U.S. abandoning previous support for a future Palestinian state. Bennett is pressing Netanyahu to renounce his commitment to the two-state solution issued, under pressure from Obama at the time, in a 2009 speech at Bar-Ilan University. Trump, for his part, has not unequivocally committed himself to the two-state concept, but has pledged U.S. involvement in talks with the Palestinians, towards “a deal that can be made.” In his confirmation hearings, Rex Tillerson, the new Secretary of State, called such a deal “a dream everyone is in pursuit of” while expressing doubt if it could be achieved.

With the shape of the new president’s Mideast policy still unclear, much seems to depend on how he’s influenced by those around him. On the one hand, Trump takes advice from his son-in-law Jared Kushner, an Orthodox Jew and the still unconfirmed ambassador-designate to Israel, David Friedman, a tax attorney who in the past, was a strong supporter of the Israeli right. On the other hand there’s Tillerson, a former oil company executive in an industry that traditionally leans away from Israel, who has extensive contacts in the Arab world. Pro-Israel sources have reason to be concerned about Trump’s last-minute veto – for political, not policy reasons – of Elliot Abrams, a diplomatic pro, who Tillerson sought to have as his deputy at State.

Faced with pressure at home from his pro-settlement rightist coalition partners, who only made his task more complex by pushing through a controversial law that retroactively expropriates privately owned Palestinian land on which settlements stand, compounded by the unpredictability of Trump’s still-unformulated Middle East policy, Netanyahu will have to marshal all of his persuasive talents on the new president. Will the unease of the Israeli leader’s relationship with Obama be replaced by an unreserved alliance with Trump? Only time will tell.

Iran Agenda

There’s another major topic on Netanyahu’s agenda with Trump, the Iranian nuclear agreement. All indications are that Netanyahu, who had been a vocal and consistent opponent of the arrangement long before it was signed in 2015, isn’t likely to get American support for its outright cancellation.

American and Israeli sources indicate that the Trump administration is considering a number of options short of canceling the controversial nuclear agreement, a move which seems unlikely to be supported by other world powers. Among the alternatives under consideration are the removal of so-called “sunset” provisions which would lift some restrictions on Iran within 10-15 years and upgrading International Atomic Energy Agency scrutiny of Iranian compliance. And though he’d prefer stronger measures, there’s a good chance that Netanyahu would go along with such moves as the best attainable options. According to one report, Netanyahu recently was given an Israel intelligence assessment suggesting that revocation of the pact would hurt U.S. relations with Russia and China.

Netanyahu’s Survival Instinct

Prime Minister Netanyahu left behind three inquiries that could affect his political future, police investigations into lavish gifts including expensive cigars and cases of pink champagne the Prime Minister and Mrs. Sara Netanyahu have received over the years from wealthy friends, including a Hollywood producer Arnon Milchan, recorded conversations with Yediot Aharonot newspaper publisher Arnon Mozes discussing a deal in which Netanyahu would help the paper in exchange for favorable news coverage, and the questionable circumstances surrounding Netanyahu’s maneuvers in support of the purchase for a high price of submarines and missile ships from Germany (payment for which will be aided by a German government grant totaling up to one-third of the subs’ cost).

Netanyahu has dismissed all the claims as patently false, says he’s done nothing wrong, and says the complaints are all part of a media campaign to unseat him. He also claims that he bought some of the cigars with money given him by a family member, and Sara Netanyahu says her husband did not know about the champagne. Though no decision to file criminal charges in any of the three cases – known as “Case 1000”, “Case 2000” and the “Submarine Affair”, respectively – is expected soon, that all three are beginning to gain  momentum.

The submarine affair, if it materializes, is certainly the most serious because it involves hundreds of millions of dollars. Last year an international tender for construction of the vessels was abruptly cancelled and the contract was awarded to ThyssenKrupp, a German shipyard owned by a consortium of a Lebanese and a Gulf base. Its Israeli agent is represented by no other than David Shimron, Netanyahu’s relative and personal lawyer. The move came over the objections of Moshe Ya’alon, then the defense minister, who was ousted by Netanyahu last summer, who has given testimony on the case to a police inquiry that for now, falls short of a formal criminal investigation. Both Netanahu and Shimron have denied that the prime minister had been informed, or knew, about Shimron’s involvement with the German firm.

Hanegbi Gets Portfolio

Tzachi Hanegbi became regional cooperation minister in late December. Hanegbi, a Likud politician and one of Prime Minister Benjamin Netanyahu’s most loyal supporters, succeeds Netanyahu, who was under pressure for holding too many portfolios. The prime minister still holds Communications and Foreign Affairs. In addition, MK Eli Cohen of the Kulanu party was named Economy Minister and the Likud’s Ayoub Kara became minister without portfolio in the Prime Minister’s Office.

Rotem New D-G

Yuval Rotem, a career diplomat and former Israeli ambassador to Australia, has been named permanent director-general of the Foreign Ministry. Rotem had been serving as temporary director-general after Dore Gold resigned from the post last October. Prime Minister Netanyahu remains acting foreign minister, with Likud MK Tzipi Hotovely as his deputy.

Viva Plus 500

Plus500, the Israeli online brokerage firm with headquarters in Haifa, has extended its deal as shirt sponsor of Atletico Madrid, the Spanish football club, for the 2017/18 season. Plus500’s name has been appearing on the Spanish club’s shirts since 2015.

The Economy

Deficit Down

Higher Israel government revenues and lower expenditures exceeded projections by about NIS 9B in 2016. The result, according to preliminary Finance Ministry figures: a budget deficit of only 2.1% of GDP, 0.8% below the official deficit target of 2.9% of GDP.

Record FC Reserves

Israel’s foreign exchange reserves at the end of December 2016 stood at a record $98.361B, up $1.234B from the end of the previous month, the Bank of Israel reported.

Annual Inflation Down Again

The Consumer Price Index for December 2016 was unchanged, the Central Bureau of Statistics reported in mid-January. For all of 2016, the CPI declined by 0.2%; it was the third consecutive year of negative inflation, after drops of .25% in 2014 and 1% in 2015.

Debt Ratio Low, But

The debt-to-GDP ratio continued to decline last year, reaching about 62% for all public debt and 0.5% for public debt excluding local authorities. According to the Finance Ministry’s Accountant General Office, the cumulative 1.8% decline in 2015-2016 was greater than that of any other country other than Germany and Slovenia. Sources say that the decline, which has a positive effect on Israel’s credit rating, is likely to cease this year due to an anticipated slowing of GDP growth to under 3%.

Tourism Up

2.9 million tourists visited Israel in 2016, up 3.6% from the previous year. About 250,000 tourists came to Israel in December.

Unemployment Down

Israel’s unemployment rate declined to 4.3% in December, down 0.2% from November’s record low of 4.3%. Most of the employment was in full-time jobs, according to the Central Bureau of Statistics. Average salary rose by over 2.5% for the second consecutive year.

Resignation at Teva CEO Seat

Teva Pharmaceuticals CEO Erez Vigodman resigned in early February. The resignation, while unexpected, was not a complete surprise. Over the last year Teva, the Petah Tikva and Jerusalem-based world leader in the manufacture and sale of generic drugs, suffered heavy losses in 2016, losing about 40% of its share price. Some of the losses were due to problems of the entire generic industry with U.S. regulators, but others were specific to Teva, notably suggestions that it had overpaid in its $40B acquisition of Actavis.

Longest Water Tunnel

Israel’s Mekorot National Water Company and Zublin of Austria have begun digging a 13-km. tunnel to carry water to Jerusalem from the Eshtaol area, near Beit Shemesh in the foothills of the Jerusalem Mountains. When the tunnel, being cut through limestone, is completed, it will be the world’s longest tunnel for transporting water with pressure.

Cakes for China

Many Chinese products are sold in Israel, as in other Western countries. In an interesting role reversal an Israeli firm has produced a consumer item for the Chinese market, which developers say is selling like hot cakes. The company is UgaUga, and the product is a ready-for-baking cake mix that’s prepared in a rice cooker, because most Chinese homes don’t have ovens. Company founder Ronen Mechanik, a 41-year-old former chef, told the Times of Israel online newspaper that the kits contain a cake powder made in Israel and other ingredients produced at C13, a technology incubator set up by Israelis in Changzhou, about 180 km from Shanghai.

And Chinese Workers in Israel

Israel has signed a preliminary agreement that would bring as many as 20,000 Chinese professional construction workers to Israel. According to a report in Globes business daily, the deal with the Chinese Ministry of Trade and China’s contractors association stipulates that the workers will be selected by Chinese authorities through companies established for that purpose. About 6,000 workers are due to arrive in Israel in the first half of 2017.

Gas Field Plans

Energean, the Greek firm that acquired Israel’s offshore Tanin and Karish gas fields plans to use huge ships rather than the conventional platforms to develop the field, the company’s founder said in a January Tel Aviv press conference. Mathios Rigas said the system, known as FPSO (floating production and storage) was more expensive but produced higher yields of gas – about 3BCM a year. Noble Energy of the U.S. and Israel’s Delek sold Karish and Tanin to the Greek firm for $150M as part of the Israel Antitrust Authority’s plan to introduce competition in the Israeli natural gas market.

Margalit Promoted

Ofer Margalit, formerly the coordinator of the defense sector in the Treasury’s Budget Branch, has been promoted to deputy director of the branch, replacing Noah Hecker.

Soccer Owner Recognized

Alona Barkat, owner of the Hapoel Beersheba soccer club, has been named marketing woman of the year by the Israel Marketing Association. Barkat has established the team, which won the Israeli Premier League title in 2016, as a strong brand in the city of Beersheba and the surrounding Negev area.

Finance & Investment

Private Equity’s Big Year

Israeli private equity funds invested a record $3.5B last year, up 14% from the around $3.1B of 2015. The growth can be attributed to four buyouts of above $100M each – BC Partners’ $1.4B deal for Keter Plastics, the $643M Siris Capital paid for Xura, Francisco Partners‘ $400M buyout of Sintec Media, and the $100M paid by FIMI for G4s Israel.

High-Tech Financing

Israeli high-tech companies raised $10B in 104 deals last year, up 12% from 2015, according to an IVC-Meitar report. The figure includes the $4.4B acquisition of Playtika by Giant Interactive Group of China.

A second report, by the Zysman, Aharoni, Gayer law firm, had different figures, saying that Israeli high-tech companies raised $4.8B in 2016, up 11% from $4.3B in 2015. Both surveys were published by Globes.

New Chinese Fund

Blueconomy Center, a Chinese investment fund managed by a team that includes Yuval Rabin, son of the late Yitzhak Rabin, has raised $150M from a group of investors including the Chinese government. The fund will focus on Israeli companies involved in technologies including wind, wave and solar energy, algae-based materials, marine food, pharmaceuticals and cosmetics, artificial islands, water purification and desalination, and construction materials. The fund has examined possible investment in about 40 Israeli companies since the summer of 2016.

Moody’s Caution

Moody’s, the international ratings agency, has praised Israel for reducing its debt-to-GDP ratio to 61% while expressing reservations about the lack of progress in the peace process and investigations of Prime Minister Benjamin Netanyahu. In a periodic review, Moody’s said that lack of continued progress on the debt ratio and geopolitical changes could cause it to lower the A1 credit rating for Israel it reaffirmed last September.

Excellence Ups Magna Stake

Israel’s Excellence investment house has increased its stake in Magna, based in the Rotem industrial park in Israel’s southern Arava desert, to 20%. Magna develops 3D security solutions for perimeter protection, maritime security and drone detection for air and sea ports, critical infrastructure installations and borders. Foresight, a Magma subsidiary, develops 3-dimensional camera systems for avoiding automobile collisions.

Apps Flyer Boosts Capital

AppsFlyer, a developer of technology enabling app developers to assess the effectiveness of mobile campaigns, has raised $56M from a group of investors including Goldman Sachs, Deutsche Telekom, Qmra Capital and Pitango. Based in Herzliya north of Tel Aviv, AppsFlyer is an official analytics partner of more than 2,000 firms, including Google, Twitter, Facebook, Adobe and Yahoo. Its customers include Macy’s, Samsung, HBO, Waze and Alibaba.

Nonwoven Cloth Soars

Four Israeli manufacturers of nonwoven cloth, Al Bad, Avgol Nonwovens, Shalag and Spuntech, whose raw material originates in the petroleum refining process, have reached a total market cap of NIS 4B (more than $1B).

Chinese Changes

Chinese government measures to restrict capital outflow in order to protect the yuan have slowed Chinese investment in Israel, according to a report in Globes. The paper estimated recent Chinese investment in Israeli firms at about $500M, and said that China’s Alibaba and Baidu were considering establishing Israeli development centers.

Magal Shares Rise

Israel’s Magal Security Systems has seen a major rise in the price of its shares since the election of Donald Trump. The company, whose sensor technology was incorporated in the fence Israel built along its southern border with Egypt, is one of several Israeli firms which could anticipate major contracts if the new U.S. president goes ahead with his plan to build a wall on the Mexican border. Magal, based in Yehud not far from Ben-Gurion International Airport, was a major contractor in security installations built for the recent African Cup of Nations in Gabon.

Mergers & Acquisitions


The Delek Group, controlled by businessman Yitzhak Tshuva, informed the Tel Aviv Stock Exchange that it had agreed to purchase Ithaca Energy of Canada for $524M. Ithaca drills for oil in the North Sea. Delek, a partner in Israel’s offshore natural gas fields, is already Ithaca’s largest minority shareholder with a 20% stake.

Huawei-Toga Networks

Huawei, the Chinese technology giant, has purchased Toga Networks, an Israeli provider of advanced technology, including routers, switchers and cloud storage systems, for the IT and telecom markets, for a reported $100M. Toga, founded in 2009, is based in Hod Hasharon, northeast of Tel Aviv.


Ormat Technologies, the Israeli geothermal energy specialist based in Yavne south of Tel Aviv, has acquired Viridity Energy of Philadelphia for an initial $35M plus conditional milestone payments. Purchase of Viridity, whose expertise is in energy storage and demand response, marks the Israeli company’s entry into those growing markets.


Rivulis Irrigation, based in Kibbutz Gvat in Israel’s northern Jezreel Valley, has purchased the Greek company Eurodrip, which was the world’s fourth largest maker of drip irrigation, and makes Rivulus world No. 2 in the field. No details of the all-share deal were announced. FIMI, the Israeli private equity fund, is the controlling shareholder of Rivulis, with Dahannan Engineering of India holding a 20% stake. Rivulus was formerly called Plastro, and then the water division of John Deere.


Maabarot Products, based in Kibbutz Maabarot north of Tel Aviv, has acquired 40% of Algaia, a French developer and marketer of raw materials produced from seaweed. Purchase price was €5M, and Maabarot also has an option to acquire control of the French firm. Algaia is expected to use proceeds of the sale to acquire Cargill of the U.S., which also deals in seaweed-based raw materials.

Taboola-Commerce Sciences

Taboola, a Tel Aviv-based content recommendation specialist, has acquired Commerce Sciences for an undisclosed sum. Commerce Sciences, with headquarters in Herzliya, develops consumer personalization technology for the Internet.

Social Code-Mentaid

Social Code, a U.S. media and analytics firm, has acquired MentAid of Tel Aviv for an undisclosed price. MentAid, founded in 2011, developed a predictive technology platform for social media, mobile and video advertising.


Huawei, the Chinese phone manufacturer, has acquired Hexatier, an Israeli database security and compliance solutions startup, for $42M. Hexatier, founded in 2009, is headquartered in Bnei Brak just east of Tel Aviv and has offices in Boston and Irvine, California. Last year the Chinese firm acquired Toga Networks of Hod Hasharon for a reported $100M.


Snapchat has purchased Cimagine Media, an augmented reality developer based in Kfar Yehoshua in northern Israel, for a reported $40M. Cimagine’s technology scans scenes captured on a mobile or wearable device camera and overlays life-like 3D images onto real-time video. The Israeli firm specializes in retail applications, and has partnered with the British retailers Shop Direct and John Lewis as well as with Coca-Cola. Users can virtually place furniture or appliances they are thinking of buying in their homes before making a decision.

Wix-Flok, the Israeli do-it-yourself website, has acquired Tel Aviv-based business technology firm Flok for an undisclosed sum. Flok’s solutions are designed to increase customer value, generate organic referrals and boost small and medium businesses’ online presence and reputation.


Vention Medical, a U.S. company, has acquired Israel’s Lithotech Medical for an estimated NIS 13M. Based in the city of Katzrin in the Golan Heights, Lithotech has developed complex nitinol (nickel-titanium) wire-based technology for medical devices.


Radware, the Israeli cyber-security and applications delivery developer, has acquired Seculert of Petah Tikva. No financial details were announced. Seculert is a cloud-based provider of defense against the breach of enterprise networks.


Celanese, a U.S. specialty materials firm, has acquired the nylon compounding product portfolio of Nilit Plastics, based in Migdal Haemek near Haifa, for a reported $250M. Nilit will retain ownership of its nylon fibers and polymerization businesses, including plants in Israel, Brazil and China.


Whitesmoke, an Israeli digital marketing and media services company based in Tel Aviv, has acquired Wise Data Media for $5.3M. Based in Tel Aviv, Wise has developed technology enabling the automated purchase of advertising on digital media without human intervention.


Physik Instrumente of Karlsruhe, Germany, has acquired Israel’s ACS Motion Control at a $27M company value. ACS, which develops and manufactures high-end motion-controllers for multi-axis motion systems, was founded in 1985; its headquarters are in Migdal Haemek, near Haifa, and it has branches in the U.S., Germany, China and South Korea.

GE Digital-Nurego

GE Digital has acquired Nurgeo, an Israeli developer of monetization platforms. No financial deals were announced for the purchase of the Israeli firm, which has offices in Herzliya and Seattle and has GE Digital as a client for the last two years.


Dell, the computer manufacturing giant, has acquired Comillion Collaborative Security, a developer of cyber threat-detection technology based in Tel Aviv and New York. Dell plans to integrate Comillion’s technology into it’s proposal for national Computer Emergency Readiness Teams (CERT) and cyber security operations centers (SOC).


Kik Interactive, a Canadian chat platform, has acquired Tel Aviv-based group video specialist Rounds. Purchase price was not announced. Rounds allows simultaneous group video chat of up to 12 friends while they all are watching videos, playing games or engaging in other group activities. About 40 million people currently use the Tel Aviv firm’s technology.

Chinese Buyer For Servotronix

Servotronix Motion Control, based in Petah Tikva east of Tel Aviv, has been sold to an unnamed Chinese buyer at a company valuation of $170M. The buyer paid $30M for the share of Servotronix, a developer of automation systems, previously owned by Ruth Wertheimer, the daughter of Israeli industrialist Stef Wertheimer. The Wertheimers are best known for selling Iscar, the precision blades maker headquartered in northern Israel, to U.S. mega-investor Warren Buffett in a two-stage transaction for a total of $6B.

Alibaba Investment

Alibaba, the Chinese e-commerce giant, has invested $6M in the latest financing round of Israel’s Lumus. Lumus, based in Rehovot southeast of Tel Aviv, produces augmented reality lenses, a necessary component of AR glasses and headsets.

Science & High Technology

Tech Exports Mixed

Exports by conventional technologies rose 13.9%, mixed high-tech industries dropped 9.7% and conventional exports were down 0.5% in 2016, according to Central Bureau of Statistics figures published in mid-January by Globes. Globes attributed part of the fall in mixed high-tech to the temporary closing, for work on its expansion, of the Intel fab in Kiryat Gat during the first half of 2016.

Science Pact with India

Israel and India have signed a bilateral scientific cooperation treaty aimed at encouraging joint research projects by young scientists, mainly in the applied sciences. Under terms of the agreement, signed during Science Minister Ofir Akunis December 2016 visit to India, each country will provide $1M for joint research projects in 2017.

‘Maturing’ Trend

The number of Israeli high-tech with more than 100 employees has risen 30% since 2010, and smaller companies are seeking to establish themselves rather than looking for a quick exit, according to a Dun & Bradstreet survey released in January. There are now almost 400 such firms, and the number is increasing by 4% each year.

Sensing Smartphone

Israel’s Consumer Physics, Changhong Electric of China and Analog Devices of the U.S. have teamed to produce the world’s first cellphone capable of sensing the properties of foods, liquids, medications, body metrics and other substances. Officials at Consumer Physics, based in Hod Hasharon northeast of Tel Aviv, say the Changhong H2 gives consumers new ways of dealing with personal health issues, select the best fruits and vegetables, stick to their diets and nutritional needs, and verify product authenticity.

India Deal

A tier-1 Indian mobile operator has placed follow-up orders valued at $60M with Ceragon Networks, an Israel wireless backhaul specialist.

New Intel Helmet

Intel‘s new merged virtual reality helmet, released late last year, was developed at the multinational chipmaker’s development center in Haifa. Project Alloy combines virtual and actual worlds seamlessly, according to the manufacturer. In a demonstration, an Intel staffer showed how Alloy can copy a room, then recreate it as a virtual battlefield and as a space ship.

On The Road

A fleet of 40 autonomous cars will be on the road this year, according to an announcement by Intel and Mobileye, the Jerusalem-based developer of auto-safety and accident-prevention sensors and visual devices. The technology will be installed in BMW series automobiles. Mobileye, Intel and BMW established a partnership to develop autonomous cars last summer.

Amazon-Kornit Digital Team

Kornit Digital, a specialist in digital printing on cloth based in Rosh Ha’ayin northeast of Tel Aviv, is providing online retailing giant Amazon with machines and technology for the U.S. company’s Merch, involving on-line personal design of shirts. The two companies have been working together for more than a year on online clothing design using Kornit’s Avalanche 1000 printer.

Kuang-Chi to Tel Aviv

China’s Kuang-Chi group launched a $250M fund in connection with the opening of its Tel Aviv International Innovation Headquarters. Called GCI Fund II, it will invest $250M in global technology ventures in the areas of smart city/smart home, IT, artificial intelligence, VR/AR and robotics.

Age of Aquarius (Engine)?

Israel’s Aquarius Engines says it has developed a revolutionary new internal combustion engine that doubles the efficiency of standard engines. The company says its single-cylinder 500 cc engine generates 86 horsepower while utilizing 40% of energy input, compared to the 20% figure for current automobile engines. The engine does not provide power directly to a vehicle’s wheels, but produces electric current for two small motors that do so. Investors in Aquarius, which is discussing its hybrid system with Peugeot, the French automaker, include Glenrock, owned by Leon Recanati, and Marius Naacht, one of the founders of Check Point Software.

Bone Breakthrough

Haifa-based Bonus Biogroup has reported a successful early-stage clinical trial of its laboratory-grown semi-liquid bone graft on 11 patients. Material, grown in a lab from each patient’s own fat cells was injected into and filled the voids of the problematic bones. Over a few months it hardened and merged with the existing bone to complete the jaw, Bonus said. Bonus CEO Shai Meretzki said it was the first time “reconstruction of deficient or damaged bone tissue is achievable by growing viable human bone graft in a laboratory, and transplanting it back to the patient in a minimally invasive surgery via injection.”

Teva Official Resigns

Sigurdur Olafsson is leaving his post as president and CEO of Israeli pharma Teva Pharmaceutical Industries Global Generic Medicines Group. The resignation was announced 2½ years after Olafsson took over the post, and just 4 months after completion of Teva’s acquisition of Actavis, the generic medicines division of Allergan, which Olafsson initiated and led. He will be replaced by Dipankar Bhattacharjee.

In another development, Teva has agreed to a $225M settlement in an antitrust case against Barr Laboratories, a California firm it acquired in 2008. The settlement comes in a suit filed in 2000 (well before Teva bought Barr for $7.5B) by individuals and nonprofit groups accusing Barr of deliberately keeping a generic version of the Cipro antibiotic off the market in order to raise prices.

Joint Investment

Samsung Venture Investment, Apple Assembler Foxconn and MediaTek, the Taiwanese chip designer, have invested a total of $15M in Core Photonics of Tel Aviv. The Israeli firm, a leading vendor or smartphone dual camera imaging technology, plans to use the investment for dual camera and action camera development.

Orbotech’s Chinese Deal

Orbotech, the specialist in printed circuit boards, flat panel displays and electronic inspection systems based in Yavne, southeast of Tel Aviv, has signed a $61M deal with BOE Technology, a leading Chinese manufacturer of flat panel displays. The Israeli firm will supply inspection and testing solutions. At first, the facility’s output will be 90,000 screens a month, rising to 120,000 by 2019.

Cyclists’ Friend

Everysight, a spin-off of private defense contractor Elbit Systems, is about to launch Raptor, its augmented reality sunglasses providing cyclists with a display similar to that available to fighter-jet pilots. Everysight CEO Assaf Ashkenazi says that while current sunglasses “obstruct the rider’s vision,” Raptor floats information directly before the rider’s eye, increasing safety and maximizing performance.

Cannabis Research

The ministries of Health and Agriculture are providing NIS 13M (about $3.5M) for 13 cannabis research studies dealing with medical issues and improving crop yields. Topics of the studies include identification and specification of new ingredients in strains of medical cannabis, the use of cannabis and its effect on vision, involvement of cannabis in the development of colon cancer, treatment of multiple sclerosis using cannabis, the use of cannabis to prevent rejection of transplanted organs, and a test of the plant’s ability to delay the development of harmful bacteria.

Amdocs Workforce

Amdocs, the provider of business information services with bases in Ra’anana-Kfar Saba, Israel and St. Louis, now has more employees in India than in both Israel and the U.S., Calcalist, the economic supplement of Yediot Aharonot newspaper, reported in December. The company employed 10,200 people in India, compared to 4,800 in Israel and 4,700 in the U.S. The figures, for the Amdocs fiscal year that ended in November, showed a 28% increase in the Indian workforce between 2014 and 2016.

Teva’s Optiod-Abuse Drug Gets OK

The U.S. Food and Drug Administration (FDA) in mid-January gave approval to Vantrela, Teva Pharmaceuticals‘ pain management drug with abuse-deterrent properties. The drug is expected to reduce, though not necessarily eliminate, oral, nasal and intravenous use of the opioid. In clinical trials, there was evidence that healthy recreational drug users had a significantly lower “drug liking,” “overall liking,” and “willingness to take the drug again” compared with agents that are not formulated to deter abuse.

Aerospace & Defense

Arrow-3 Deployed

The Arrow-3 missile interception system, Israel’a first line of defense against advanced missiles, including Iran’s Shihab, became operational in mid-January. Capable of reaching twice the altitude of Arrow-2, which has been operational since 2000, the system is designed to intercept and destroy multiple targets in space. The system was developed and produced by Israel Aerospace Industries (IAI) in cooperation with Boeing, the U.S. defense contractor and funded largely by the U.S. The system uses Green Pine radar of Elta Systems, an IAI subsidiary, battle management and launcher control systems from Elbit Systems, and a rocket motor developed by Israel Military Industries (IMI).

Arrow is the top tier of Israel’s three-level missile defense system, which also includes David’s Sling and Iron Dome systems against medium and shorter range attacks.

In mid-January, the Defense Ministry, the U.S. Missile Defense Command and the Israel Air Force successfully tested an improved version of David’s Sling at the Yanat Sea Range of the Israeli coast. The first units were delivered to the IAF in 2015, and the system is soon expected to be declared operational.

Dutch, Swedes Pick IMI’s Iron Fist

The Dutch Army and BAE Hagglunds of Sweden have selected IMI‘s Iron Fist light active defense system for the Dutch Army’s armored personnel carrier. Value of the contract was not announced. Iron Fist is not the only Israeli company to produce active defense systems for armor: Trophy (called Windbreaker in Hebrew), developed by Rafael Advanced Defense Systems, is fitted on some Israel Defense Forces armored vehicles. The Dutch are the first NATO country to outfit active defense systems for their army.

Czechs Buy Radar

The Czech Republic is purchasing eight MMR radar systems, used in Israel’s Iron Dome missile defense system. The MMR, manufactured by IAI‘s Elta subsidiary, detects rockets and other airborne munitions at ranges of up to 250 km. Purchase price is $100M.

Rafael Bond Issue

Rafael Advanced Defense Systems plans a NIS 1B bond issue, according to a report in Globes. For the purpose of the issue, Rafael’s credit rating is expected to be AAA.

Brazilian Contract

Ares Aerospacial e Defensa, a Brazilian subsidiary of Israel’s Elbit Systems, has been awarded a $100M Brazilian Army contract for remote-controlled weapon systems. The systems will be installed on Brazil’s Guarani 6X6 and other armored vehicles.

Rocket Contract

IAI Missile & Space Division says it has signed an 8-year, $345M contract to develop systems for the Defense Ministry. No details were provided in IAI’s announcement to the Tel Aviv Stock Exchange.

Delivery by Drone

Tel Aviv Flytrex, which is developing a system using unmanned aerial vehicles to make deliveries, has raised $3M from a group of investors including Armada VC of Switzerland and private Angel investors, among them Daniel Gutenberg and Joey Low. The company, which says it takes users’ delivery needs “from the streets to the sky,” has built a control and tracking system for use by large retailers and companies specializing in delivering packages. CEO Yoav Bash, one of Flytrex’s founders, told the TechCrunch website that his company’s long-term goal was “changing the way consumers behave” and complement Internet-based e-commerce “all the way to the customer’s door step.”

Female Fighters

About 7% of females IDF inductees joined combat units in 2016, sharply up from the 4% serving in those units in 2012, Haaretz daily has reported. The percentage is expected to increase this year when the army inaugurates its four mixed-gender combat battalions.

Women now serve in mixed-gender infantry battalions, in the Border Police, the Air Force and in air defense combat units. In addition, according to the Haaretz report, the army is considering deploying them as fighters in heavy vehicles in the Combat Engineering Corps, in tanks and aboard the Navy’s Sa’ar missile boats. At the same time, the percentage of female recruits assigned to purely clerical posts fell last year to 7%, the same as the percentage of secretaries.

Azeri Purchases

The total value of Israeli defense systems purchased by Azerbaijan over the years amounts to about $5B, President Ilham Aliyev of the former Soviet republic said during a mid-December visit to Israel. According to Azeri press reports, negotiations are under way for the sale of Israeli Iron Dome missile defense systems to Baku.

General Resigns

Maj-Gen Hagai Topolansky, head of IDF Manpower Directorate, resigned in mid-December, shortly after a laptop computer apparently containing sensitive information was stolen from his home in Be’er Tuvia, a village in southern Israel. Topolansky, a former fighter pilot, was in violation of IDF standing orders prohibiting officers from leaving military computers in their homes or automobiles, where they might be stolen. Topolansky’s replacement is Brig-Gen Moti Almoz, formerly the IDF spokesman.

Landau Gets OK

The committee for government appointments has given the OK to the appointment of Uzi Landau, a former Public Security minister and Knesset member for both the Likud and Yisrael Beitenu parties, as chairman of Rafael Advanced Defense Systems. Landau’s appointment has been pushed by Yisrael Beitenu head Avigdor Lieberman since he took over as defense minister in mid-2016.

Medical Glider

The IDF Medical Corps and the Haifa Technion Institute of Technology have developed a medical glider that will streamline on-the-spot treatment of wounded soldiers, according to a report in Israel Today Hebrew daily. The glider can carry up to 50 kg of medical supplies, including blood transfusion kits and antibiotics, for distances of up to 20 km. IDF medical personnel say it would be especially useful in cases of mass casualties where large quantities of medical supplies must be delivered quickly, enabling the wounded to be “delivered to hospital in better condition,” army doctors say.

New Trucks for IDF

The Israel Defense Forces has signed an NIS 200M deal to purchase heavy trucks from Oshkosh of the U.S. Oshkosh FMTV vehicles will replace some of the REO trucks currently in IDF service. The purchase will be funded by U.S. military aid money under the terms of the 10-year, $38B aid deal signed last year.

Cisco Gets Server Deal

Cisco Systems will supply computer servers to the IDF under the terms of a three-year agreement with the Ministry of Defense. Value of the agreement, which includes a two-year option to extend, was not disclosed. Bynet Data Communications, a member of Israel’s Rad-Bynet group, is responsible for installation and support.

CAEW Delivered to Italy

IAI and the Defense Ministry delivered the first of two CAEW (Confirmal Airborne Early Warning and Control) aircraft to Italy in mid-December. The system, installed on a Gulfstream G-550 platform, is part of a reciprocal agreement in which Israel purchased 30 Italian training aircraft for the IAF. The second of the planes, which are fitted with systems from IAI‘s Elta subsidiary including radar, electronic intelligence, self-defense and advanced communications, is due to be delivered later this year.

Engine Contract

Beit Shemesh Engines, controlled by Ishai Davidi’s FIMI private equity firm, has signed a long-term contract to deliver jet engine parts to Pratt & Whitney. According to the Israeli firm, the contract may be expanded to about $65M.

Hermes Increase

The IAF says it is increasing its number of unmanned aerial vehicles, starting with six-fold in Elbit Systems Hermes 900 UAVs. The Hermes 900, which the IAF calls Kohav (Star), flew its first mission over the Gaza Strip in mid-2014. It’s a medium-altitude, long-endurance UAV that has been fitted with a variety of sensors adapted from systems developed for manned aircraft and ground installations.

Azeri Barak 8 Test

Azerbaijan has tested a land-based version of the Barak 8 surface-to-air missile system, according to a report on the Israel Defense website. Quoting foreign reports, Israel Defense said that the Azeris, who reportedly have also expressed interest in Israel’s Iron Dome missile defense system, apparently had purchased an operational version including 12 launchers and 75 missiles in 2012.

Skylark in Iraq

Elbit Systems Skylark unmanned aerial vehicles are in service with French forces in Iraq, according to a report in Israel Defense. Australia reportedly has also deployed the Skylark, a mini-UAV suited for over-the-hill counter-terror missions, in Iraq.

More Women Engineers

The number of female engineers at IAI has increased in the wake of IAI’s participation with the Yediot Aharonot newspaper group, in the Women Engineers of Tomorrow project, according to IAI CEO Yossi Weiss. In the initiative, whose aim is to increase the percentage of girls studying engineering, chemistry and physics, 100 female Israeli high school students were coached by IAI women engineers in special projects.

As part of the project, Yediot profiled four IAI female engineers, each of whom holds a key post in a defense-related sector: Jenny Gurvevich, a radar systems engineer at IAI subsidiary Elta Ashdod; Dr. Einat Klein, head of air defense systems engineering; Angie Moscovitz, head of programming in the missile sector; and Reut Guetta, head of the UAV quality control administration.

Spanish Spikes

Some of the 115 URO VAMTAC ST5 vehicles due to be delivered to the Spanish Army in 2017 will be fitted with Rafael Advanced Defense Technologies‘ Spike missiles, according to a report in Israel Defense.

Spikes have also been sold to Romania in a $24M transaction. According to a report on a Romanian website, the missiles will be fitted on the country’s IAR 300 Puma helicopters and on MLI-84 armored personnel carriers, and supplied in a mobile version to Romanian special force units.

Amidror to Check IMI Deal

Reserve major-general Yaakov Amidror, the former head of Military Intelligence, has been appointed to examine Government Companies Authority proceedings in the privatization of Israel Military Industries (IMI). IMI’s privatization was frozen more than six months ago, after the intervention of State Comptroller Joseph Shapira. The controversy centered on valuation of IMI by a company connected to Elbit Systems, which at the time was the only qualified bidder for the government-owned IMI.

Meanwhile, IMI has won a 7-year, $450M Defense Ministry contract to supply the IDF with armor and artillery munitions. Supply of the munitions will begin in 2019.

Barbivai Mooted

Orna Barbivai, the first woman to reach the rank of major-general in the IDF, reportedly is a leading candidate to head the Urban Renewal Authority in the Housing and Construction Ministry. The authority is being given authority over the Clear and Build and Tama 38 projects for upgrading existing housing.

Alfassi Named

Eli Afassi has been named Executive VP Marketing at IAI. Alfassi’s current job as executive VP for IAI’s India operations will be merged into his new position.

Barak 8 Range Increased

Range of the Barak 8 surface to air missile has been increased to 150 km, according to a report in Janes military website. According to previous reports, the missile, jointly developed by IAI, India’s Defense Research and Development Organization, the Israel Weapons Development Administration, Rafael Advanced Defense Systems and IAI subsidiary Elta Systems had a maximum range of only 70 km.

Companies Take Aim

Israel’s Ministry of Defense has not yet unveiled its plan for acquiring the artillery of the future. But Globes says that defense firms are already lining up for what apparently will be a large-scale, lucrative contract. One of the main potential competitors for the right to supply self-propelled cannons capable of rapid fire with a high degree of accuracy is Elbit Systems. The private defense contractor, which acquired the plant of artillery-specialist Soltam in 2010, is offering its 155-mm Athos howitzer, capable of firing 6 shells a minute with a 40 km range. The main competitor, according to the Globes report, is an alliance of Israel Aerospace Industries and Israel Military industries, both government owned, with KMW of Germany, who are offering the AGM, which has 40-km range plus advanced mobility and navigation capabilities.

Opportunity for Elbit?

New Federal Aviation Authority regulations enabling passenger jets to take off and land under difficult weather conditions may prove to be an opportunity for Israel’s Elbit Systems, whose ClearVision system has already been installed in executive jets. Elbit claims its system, adapted from one in use on military aircraft, is the worlds most advanced. It’s based on a camera that projects a picture of the incoming airport on a special screen, even in the most difficult weather conditions.

Meanwhile, Elbit has been awarded a $110M contract from an unnamed Asian country to upgrade and maintain dozens of M-17 helicopters over a five-year period, a $17M contract to supply its BriteNite navigation systems to the helicopters of a NATO country, two contracts totaling $35M to supply airborne laser designators to Israel’s Rafael Advanced Defense Systems, and a $100M contract through its Brazilian subsidiary for Remote Controlled Weapons Systems to Brazil’s army. And Elbit’s U.S. subsidiary, Elbit Systems America, has won a $7.3M contract to supply gunner’s hand stations for U.S. Army Bradley armored personnel carriers.

Boeing Satellite for Spacecom

Israel’s Spacecom, which last year lost its Amos 6 in a pre-launch explosion of Elon Musk’s SpaceX on a Florida launch paid, says it is purchasing a new satellite from Boeing for $161M. Amos-17, designed to operate for 15 years, will expand Spacecom’s coverage of growing satellite service markets in Africa, the Middle East and Europe. Last year Spacecom lost contact with its Amos-5 satellite, which was launched in 2011 and provided coverage to clients in Africa.

Cooperation OK’d

Israel’s Antitrust Authority now permits Israeli defense industry companies to cooperate on exports so long as it does not harm Israeli interests, according to a report in Calcalist. In the past, the paper noted, Israeli companies have been at a disadvantage in competing on their own against defense industry giants.

Rafael’s Spice ‘In Fashion’

Bombs and missiles with map-reading capabilities rather than reliance on GPS coordinates are in fashion again with the world’s military, according to Britain’s Economist – and Israel is in the forefront. The leader in the field is Rafael Advanced Defense Systems‘ Spice, which it calls “an add-on kit that turns unguided bombs into smart ones.” Spice can guide munitions fired from a range of up to 100 km to within 2 meters of its target, and is not confused by changes in terrain or camouflage. “All you need,” according to the report, “is a picture of what is to be hit and an approximate location, for Spice to find and hit it.”

IMI to Speed Land Handover

IMI says it plans to hand over 500 dunams (125 acres) of prime land in the center of the country to the Israel Lands Authority ahead of schedule, according to a report in Globes. The firm eventually will be moving production plants of a new site at Ramat Beka in the southern Negev desert.

Rafael Appointment

Dr. Irit Idan has been named executive vice president and head of Rafael Advanced Defense Technologies R&D branch. She succeeds Dr. Roni Potsman.

Israeli Suit Headed to Moon

A suit designed to protect humans against the effect of cosmic rays on bone marrow is due to be tested on Orion, the NASA flight to the Moon planned for 2018. Dummies will wear the suit made by Israeli start-up StemRad on the lunar flight in preparation for NASA‘s manned 2021 mission to Mars. StemRad is cooperating with Lockheed Martin, the American defense contractor, in the Mars project.

Via Hits Paris

Via, the Israeli developer of ride-sharing, is due to launch in Paris following successful operations in New York, Washington, D.C., and Chicago. The company, which has offices in New York and an R&D center in Tel Aviv, is cooperating in Paris with Keolis, a global public transportation operator, in providing shared rides with a professional driver.

IAI’s Jamming Defense

IAI has launched ADA, an advanced avionics system that protects GPS systems from jamming. The system, which has been integrated into several systems in Israel and abroad, was due to be displayed in mid-February at the Aero-India exhibition in Bangalore.

Phone Protection

Scientists at Ben-Gurion University of the Negev have developed a system that can determine if a cellphone has been stolen within 14 seconds, according to a report in Globes. The technology, which identifies the users by the way they touch the phone’s screen, was displayed at a late-January technology show in Tel Aviv. Developers say the technology, based on how many times and where the user touches the phone’s screen within a few seconds, is especially effective because a thief may steal the phone but probably can’t imitate the owner’s behavior.

General Staff Moves

Defense Minister Avigdor Lieberman has extended the term of Chief of Staff Lt-Gen Gadi Eizenkot to four years. Eizenkot (who recently took brief medical leave for prostate surgery) assumed command of the IDF in 2015. In addition, Maj-Gen Amir Kohavi will succeed Maj-Gen Yair Golan as the IDF’s deputy chief of staff. Kochavi, a former head of Military Intelligence, has been in charge of the Northern Command for the past two years.

Other IDF General Staff appointments include Maj-Gen Yoel Strick as Kochavi’s successor at the Northern Command, Maj-Gen Tamir Yadai to take Strick’s place as commander of the West Bank Division, and Maj-Gen Amir Nurkin as new Air Force commander in place of Maj-Gen Amir Eshel.

Firefighting Satellites

Dozens of mini-satellites circling the Earth capable of spotting fires and directing firefighting teams to them are envisioned as part of a joint initiative of Israel’s Science Ministry and private Israeli aerospace contractor Elbit Systems. According to a press report, it would take only 30-50 the mini-satellites, no larger than a milk carton and fitted with advanced sensors and cameras, to cover the entire territory of Israel. It quoted an Elbit official as saying that with current technology, even small fires can be detected from an altitude of 500 kilometers above the Earth’s surface.

Meanwhile, Yediot Aharonot reported that a similar-sized mini-satellite made by IAI in cooperation with Ben-Gurion University in Beersheba was due to be launched from India in late February or early March. The BGUSAT will monitor climactic changes.

Army Radio to Stay

In the midst of ongoing controversy and uncertainty about the future of Israel’s government-owned broadcasting service, Defense Minister Avigdor Lieberman decided in early February that Galei Zahal, the IDF’s radio station, will remain under Defense Ministry control. Lieberman made the decision together with Defense Ministry director general Ehud (Udi) Adam.

IAI’s Cyber Division

IAI has established a special division to deal with the cyber business of its Elta Systems subsidiary and named the new division’s general manager.

IAI president and CEO Joseph Weiss calls the new division a major source of future growth. With more than $100M in cyber-related contracts last year, the company is developing cyber solutions and advanced capabilities for intelligence, monitoring, identification and accessibility, offering clients tools to tackle cyber threats, in R&D and innovation centers in Israel, Singapore and Switzerland. According to a report by the nonprofit Start-Up Nation Central, 65 cyber startups were set up in Israel in 2016, and firms specializing in cyber-security raised a record $581M.

New Heron Version

IAI was due to introduce the latest Heron TP-XP long-distance unmanned aerial vehicle at the mid-February Aero India show in Bangalore. An export version of the Heron TP, which has been in IAF service since 2010, the UAV has a high standard of reliability and can operate in extreme weather conditions.

Mortar Warning System

The IDF has been acquiring mobile sirens to warn of mortar attacks from Gaza. The sirens, developed in cooperation with Motorola, are designed protect soldiers and communities near the frontier, under the range of Israel’s Iron Dome anti-missile system. In addition, new radar developed by Rada Electronic Industries which detects incoming projectiles more quickly adds an extra 2-3 seconds to warning time for the shorter-range attacks.

Truck Replacement

The IDF will call for bids to replace about 300 Ford F150 pick-up trucks acquired in 2010, according to a report in Yediot Aharonot. The purchase will be financed from U.S. military aid funds.

Palti to Replace Gilad

Defense Minister Avigdor Lieberman has approved a special committee’s recommendation to name Zohar Palti as head of the ministry’s powerful Political-Military Affairs Bureau. Palti replaces Amos Gilad, who has held the post since 2003. Palti is a former head of both the Mossad’s intelligence department and the research division of Military Intelligence.

Hybrid’s Maiden Flight

Panther FE, a vertical take-off unmanned aerial vehicle jointly developed by IAI and Hankok Carbon of South Korea, has taken to the air in a recent test flight in South Korea. The UAV is powered by three electric motors on take-off and landing, and by an internal combustion engine during flight. Total weight of the UAV is 87 kg, two kilograms more than the conventionally-powered Panther.

Ethiopian APCS

Gaia Automotive Industries of Hasolelim in northern Israel, is cooperating with Ethiopia in the building of 75 multi-purpose 4×4 armored personnel carriers in the African country. After developing a prototype of the Ethiopian APC and building five vehicles, a team of Gaia experts went to Ethiopia to set up a production line for the remaining vehicles under the terms of an agreement dating back to 2011-2013.