Israel’s Matrix to snap up Magic Software in $2.1 billion IT services merger deal
Herzliya-based information technology company says the combined firm will employ over 15,000 people and provide IT services to 6,000 businesses around the world
Sharon Wrobel is a tech reporter for The Times of Israel.
Israeli information technology provider Matrix IT Ltd. has inked an initial agreement to buy rival Magic Software Enterprises Ltd. in a mega merger deal worth NIS 7.7 billion ($2.1 billion).
The Herzliya-based company said it has signed a memorandum of understanding for a merger deal with Or Yehuda-based Magic Software, which is traded in the US on the Nasdaq exchange and in Israel on the Tel Aviv Stock Exchange. The NIS 7.7 billion valuation of the merged firm “would place it among the top 10 largest publicly traded IT services companies in the US and in Europe,” Matrix said.
Under the terms of the deal, Matrix will buy out the entire share capital of Magic. As a result, Magic’s shareholders will hold 31.125% of the merged company, and Matrix’s shareholders will own 68.875%.
Upon completion of the merger deal, Magic will be delisted from both exchanges, in the US and Israel, and become a subsidiary of Matrix. The deal is pending shareholder and regulatory approvals. The transaction is expected to be approved in the third of quarter of 2025.
Founded in 2001, Matrix is one of Israel’s largest tech companies, employing about 11,570 people, mainly in Israel. It is listed on the Tel Aviv Stock Exchange with a market value of about NIS 5.6 billion. During the challenging war period, the company generated a record NIS 5.58 billion in sales in 2024, an increase of about 6.6% versus the same period a year earlier. Among its partners and clients are AWS, Google, Oracle, HP, SAP, DELL-EMC, and BMC.
“Our activity in the defense system and defense industries continues to be extensive and keeps growing consistently,” said Matrix CEO Moti Gutman in November. “As a result of the war, we see continued investment by customers in cyber defense and in services and products for protection and recovery from attacks, as well as in infrastructure and solutions that enable business continuity and disaster recovery.”
Through the Magic merger, Matrix, which holds a dominant market position in Israel, seeks to expand its geographic footprint and boost its exposure, in particular to the US market. The merged company will serve about 6,000 active clients, employ over 15,000 people, and operate in about 50 countries.
Magic is a provider of software services for businesses for the integration of mobile, IoT, Big Data, communications and other applications, as well as IoT devices, cloud, cyber, and security solutions. The IT firm has 24 regional offices across the US, Europe, and Asia; and has partnerships with IBM, Microsoft, Oracle, Salesforce.com, and SAP.
