Leading Israeli IT Group quoted on NASDAQ Joins the Asseco Group

On 3 September 2010 Asseco Poland SA concluded two agreements to purchase shares in Formula Systems seated in Or Yehuda, Israel. Ultimately, Asseco Poland will hold 6,823,602 shares in Formula Systems representing 50.19% of the share capital and 51.18% of votes at the General Meeting of Shareholders of Formula Systems. The total transaction cost will not exceed USD 145.3 million.

The first agreement was signed with Emblaze Ltd. – an IT focused investment company listed on London Stock Exchange, registered in Ra’anana, Israel. Asseco Poland concluded the agreement for acquisition of 6,687,642 shares representing 49.19% of the share capital and 50.66% of votes at the General Meeting of Shareholders of Formula Systems. The transaction will be finalized once the General Meeting of Shareholders of Emblaze approves the sale of the shares, which is expected to take place not later than November the 30th.

The second agreement was concluded with a private individual, a member Formula Systems management board. This is an option agreement under which the said person is entitled to sell 135,960 shares in Formula Systems. The shares being subject to the option represent 1% of the share capital and 1,03% of votes at the General Meeting of Shareholders of Formula Systems.

Formula Systems is a holding company established in 1985. The holding owns shares in three IT companies: Matrix IT, Magic Software Enterprises, and Sapiens International Corporation. Shares of Formula Systems are listed on TASE (Tel Aviv Stock Exchange) as well as on NASDAQ Global Markets. Companies of the Formula Systems group operate in Israel, USA, Canada, Japan, United Kingdom, Germany, Netherlands, France, Hungary, and India.

"The project of Asseco won my recognition right from the beginning. I can see huge development potential in our partnership. Asseco provides access to new markets, especially in Central and Eastern Europe, where we have had hardly any operations so far. I am glad that Formula will have real impact on the shape and direction of development in the group. I hope that together we will manage to acquire further valuable IT companies to strengthen our position in the markets where we already operate as well as to open new opportunities for the business." – says Guy Bernstein, CEO at Formula Systems.

"I am extremely satisfied that one of the largest IT companies in Israel has joined the Asseco Group. I have great hopes for this partnership. Asseco has gained partners in one of the most innovative countries in the world. We will use this  opportunity to enter new markets and benefit from access to sophisticated know-how and highly innovative products and technologies. We believe that together with Formula we will gain momentum to create a truly global company. I am convinced our cooperation will bring measurable benefits to Asseco as well as to all the companies operating within the Formula Systems holding. – says Adam Góral, President and CEO at Asseco Poland.

The most significant Formula Systems’ assets include shares in three IT companies:

Matrix IT Ltd – 50.1% – one of the leading integration and information technology services companies in Israel. Matrix employs approximately 4,200 software, hardware, integration and training personnel, which provide IT services to more than 500 customers in the Israeli market. Matrix is active in four principal areas: software solutions and services, software distribution, infrastructure solutions and hardware products, and training and assimilation. The company's solutions are provided to various sectors of economy, including banking and finance, telecommunication, public administration, healthcare, and enterprises. Net profit achieved by Matrix IT for the year 2009 reached USD 20.3 million, operating profit was USD 28.4 million, whereas revenues from sales generated by the company were USD 368.5 million. The company is listed on TASE.

Magic Software Enterprises Ltd – 58.1% – develops, markets, sells and supports application platforms and business and process integration solutions. In addition to technology, Magic Software provides its customers with maintenance and technical support, as well as professional services and training. Magic Software is known for its code-free approach, allowing users to focus on business logic rather than technological requirements. This approach forms the driving principle of both the uniPaaS application platform (the next generation of eDeveloper) and the iBOLT business and process integration suite. In 2009 Magic generated USD 20.3 million of revenues, while its operating profit and net profit amounted to USD 6.2 million and USD 6.2 million, respectively. Magic is listed on TASE and NASDAQ Global Markets.

Sapiens International Corporation NV – 71.6% – global provider of software solutions for the insurance industry. Sapiens' eMerge™ is a rules-based model-driven architecture, that is used to develop most of Sapiens' software products. It enables the creation of mission critical core enterprise applications with little or no coding using agile methodologies. Sapiens' technology allows customers to achieve legacy modernization and enterprise application integration. Sapiens has also formulated Sapiens INSIGHT™, a suite of modular business software solutions that helps insurance carriers adapt to the dynamic insurance marketplace. In 2009 Sapiens generated USD 45.7 million in revenues, while its operating profit and net profit amounted to USD 5.3 million and USD 4.2 million, respectively. This company is listed on TASE and NASDAQ Global Markets.