As part of Israel’s business efforts to build long bridges, the Israel-China investment fund Catalyst CEL is investing $42 million in Switzerland-based Lamina Technologies — a manufacturer of precision carbide metal cutting tools originally established in Israel.
The deal shines a light on Israel’s role in bringing the tech world’s “old” and “new” economies together. Alongside its good business aspect, Israel has helped enhance relationships between entrepreneurs and investors from around the world, bringing innovations to people far beyond its borders.
Ten million dollars of Catalyst CEL’s $42 million investment will go toward funding global expansion of Lamina, and up to $32 million will be distributed to Lamina’s existing shareholders. The investment will give Catalyst CEL a controlling stake in Lamina, in partnership with the current management team led by Peleg and Yuval Amir, who co-founded the company in 2001. The Amir brothers will remain in their leadership position, and together they will be the second largest group of shareholders in Lamina.
Lamina produces articles like milling and turning inserts for manufacturing in a wide range of industries, using high-tech fabrication methods — and as such, it provides an important bridge between the “old” manufacturing economy and the “new” computerized one. The precision manufacturing employs Lamina’s know-how in sub-micron powder technology, PVD coatings (a special hardened coating applied to machine parts), and advanced materials for building machines for the aerospace, defense, automotive, transportation, die and mold, and machine tool manufacturing sectors, among others. The production process is highly computerized, requiring high-level programming and big data applications, and many of the company’s production systems developed in Israel.
That Lamina is being funded by a joint investment fund run by firms from Israel and China is representative of another aspect of the new economy — turning from West to East. As the economies of Asia continue to grow, more Israeli firms are seeking opportunities in places like China, India, Vietnam, and Korea — and those opportunities are generating more money for investment from both Israel and its Asian partners.
The Catalyst CEL Fund, sponsored by Israel’s Catalyst Equity Management and Hong Kong-based Everbright, was established last year to invest in Israeli companies that can help China grow its economy and provide opportunities for its burgeoning population. “China has a lot of needs, and we believe that Israeli companies are in unique a position to bring in many of the solutions China needs,” said Shangyan Fen, head of strategic investment and development at China Everbright Ltd., and a managing director in the fund. “We are concentrating on bringing in companies that have established solutions in areas like technology, environmental and water technology, manufacturing, and even consumer needs.”
The Catalyst CEL fund targets companies that plan to do business in China, and are mid- to late-stage companies with proven innovation and global presence — in other words, companies that are well-established in their industries and are ready for a boost in business. Lamina fits that description, said Fan, as it is “well positioned for China’s macro developments and the ongoing domestic technological upgrade as China is a key market with significant room for growth.” Fan’s comments were echoed by Peleg Amir, CEO and founder of Lamina, who said that the company “has multiple, high potential growth opportunities, and with the equity investment of Catalyst CEL combined with their significant relationships and capabilities in China and other global markets, Lamina is well positioned and capitalized to execute on our next growth phase.”
According to Edouard Cukierman and Alain Dobkin, Managing Partners of Catalyst CEL, “under Peleg and Yuval Amir’s leadership, Lamina developed into a leading global designer, manufacturer and marketer of leading-edge precision carbide cutting tools with a strong presence and significant penetration of key global regions. We see significant opportunities for expansion into the China market.”