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THE ECONOMY The largest-ever acquisition made by an Israeli company is underway: "Capital" acquired the Dutch-British real estate company "Halsmere" for $1.27 billion. The purchase proposal made by "Capital", which is traded on the Stock Exchange at a market value of $25 million, received the approval this week of the acquired company, which has shareholders capital of $1.6 billion. "Capital", whose junior partner is the American company "Apollo" (30%), is involved in real estate investments, hi-tech, and providing services in the capital markets. The company's major shareholders are Shimon Weintraub and Ronen Peled. Despite everything, overseas investments in Israel continue: the world's largest water corporation - the French company "Suez" will invest $300 million in water and energy infrastructure in Israel. "Suez" has numerous economic interests in Arab countries - power stations in Syria, desalination plants in Iran, Dubai and the Gaza Strip, sewage and waste-water treatment plants in Cairo, water management in Amman and it will soon be drilling for water in Libya. The company's representative, Jacques Horgen, said that the decision to invest in Israel was made despite its numerous interests in Arab countries. Meanwhile, "Suez" is already competing in the tender to erect a desalination plant in the Haifa Bay area. The Israeli company "Sargon", which manufactures telecom systems, has won a tender issued by the Swedish company "Swenska". The Israeli company will supply fiber-air systems for links and infrastructure management for a new cellular network to be established in Sweden. The deal is estimated to be worth $30 million. "Sargon" is competing in other tenders in Scandinavia and the Far East, and will soon enter the North American market. The Israeli company "Albad" that manufactures wet wipes is purchasing a wet-wipes plant in Western Europe with an annual turnover of Euro 8 million. As a result of the acquisition, 30% of the company's manufacturing capacity will be transferred to Europe. The company recently acquired another wet-wipes plant - the German company F.H.W., for Euro 9.7 million. Despite the Intifada, Israel's exports to Arab countries grew 8% in 2001 and amounted to $128 million. Most of the increase was in the textile and chemical sectors to Jordan, and exports of agricultural inputs and chemicals to Morocco. Some 70 Israeli companies export directly to Arab nations. The growth in such exports is particularly marked against the backdrop of an overall decline in Israeli exports - a 5.5% drop in 2001 to $19.5 billion. The international rating company Moody's has lowered its financial rating for Israel's banks (Hapoalim, Leumi, Discount, International, and UMB) from stable to negative. According to Moody directors, the lower rating reflects the deterioration in the bank system as a result of the security situation and the global economic crisis. Nevertheless, Moody's does not expect any of Israel's banks to collapse.
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