Altshuler Shaham Investment House is leading a group of institutional investors that will acquire a 20%-25% stake in the computer and electronics retail store chain KSP.
The stake will be acquired at an estimated company valuation of NIS 2.3 billion. Negotiations on the deal are believed to be at an advanced stage, and if it is completed, KSP founders Zeev Sorkin and Yaakov Prilock will sell shares for up to an estimated NIS 580 million.
Just two months ago, the retail chain's owners were in talks to sell a 25% stake to institutional investors for a company valuation of below NIS 2 billion, but especially strong financial results for 2024 strengthened the hands of Sorkin and Prilock.
KSP has 63 stores around Israel, including five stores in Eilat, where products can be bought without VAT, to Afula, Nof Hagalil, and Haifa Bay in the north. Like other retail stores, the chain has benefitted over the past year as Israelis have preferred not to travel abroad due to the expensive cost of airfares.
The chain opened its first stores 20 years ago in Haifa's Hadar district. The name of the chain stems from the surnames of the three founders — Oded Koren, Sorkin, and Prilock. KSP began as a store that imported computer components. Later, Koren left the partnership.
The chain expanded into assembling and selling computers themselves and then selling computer peripherals and smartphones. In 2010, the company began to expand into other areas that were not related to computers.
Today, it is a retailer that provides a wide range of home improvement products, as well as cosmetics, watches, clothing, lighting, home and garden accessories, and more. In addition to its physical stores, KSP also operates a sales website.
Double-digit growth
During the big wave of Initial Public Offering (IPOs) in 2021, Sorkin and Prilock considered a Tel Aviv Stock Exchange (TASE) IPO at a company valuation of NIS 1.4-1.5 billion based on their then-estimated annual net profit of NIS 80-100 million after strong results during the Covid pandemic. If the planned private placement with institutional investors is completed, then the IPO option will be off the agenda until at least 2026-2027.