Israeli Telecom Firm Telrad Shrinks Dramatically Post-Acquisition
Translated & summarized from Globes by baba
Israeli telecommunications equipment company Telrad has drastically reduced its workforce from over 1,000 employees to around 70 in Israel since being acquired by Liquid Intelligent Technologies in 2022 for approximately NIS 200 million. The buyer implemented a strategic reorganization, selling off non-core assets and subsidiaries like Marmenet and Magalcom. This move contrasts with earlier expectations of expansion following the acquisition. Liquid aims to focus on profitable growth in areas aligned with its core strategy, including cloud infrastructure and cybersecurity.
The story in 5 lines · by baba
- Telrad's Israeli workforce has shrunk from over 1,000 to about 70 employees post-acquisition.
- Liquid Intelligent Technologies acquired Telrad in August 2022 for approximately NIS 200 million.
- The company underwent a strategic reorganization, selling off subsidiaries like Marmenet and Magalcom.
- Telrad was founded in 1951 and previously owned by the private equity fund Fortissimo.
- The reduction in staff occurred despite prior expectations of expansion.
Four years after its acquisition by African corporation Liquid Intelligent Technologies (Liquid) for approximately NIS 200 million, the Israeli telecommunications equipment company Telrad has significantly downsized. While Telrad employed over 1,000 workers in Israel shortly before its sale, the acquiring group now employs only about 70 people in the country. This reduction follows a strategic reorganization by the buyer, which involved selling off parts of the business to focus on profitable growth areas aligned with its core operations.
Telrad, founded in 1951, has undergone numerous transformations and ownership changes. Most recently, before its 2022 sale, it was owned by the private equity fund Fortissimo, led by Yuval Cohen. Fortissimo also managed Telrad's IPO on the Tel Aviv Stock Exchange in 2017 and its subsequent sale.
Liquid acquired Telrad in August 2022, delisting the company from the Tel Aviv Stock Exchange. The acquisition encompassed Telrad's subsidiaries involved in supplying products, solutions, and services to telecom operators, as well as communication infrastructure, cybersecurity, and IT. Since the purchase, Telrad has experienced a substantial reduction, with some describing it as a "dismantling." This included the sale of its Latin American operations and two key subsidiaries: Marmenet, focused on outsourcing project management for government entities, and Magalcom, specializing in large projects including communication infrastructure, security, and data centers.
Marmenet was sold to the private group Maof, and Magalcom was acquired by the fund Qumra. In late 2021, Telrad employed 1,774 people across its subsidiaries. At the time of the sale, both Fortissimo and Telrad's management anticipated the acquisition would lead to Telrad's expansion in Israel, serving as a significant technological hub for the entire group. However, the opposite has occurred, with Liquid now employing only around 70 staff in Israel.
Liquid stated that the strategic reorganization was aimed at focusing on profitable growth areas aligned with the group's core strategy. Non-core activities were sold, while Liquid retained businesses in cloud infrastructure, cybersecurity, and key international markets. The reorganization allowed Liquid to concentrate resources and investments in areas identified for strong strategic alignment and long-term growth opportunities.