Israeli Smart Glass Firm Gauzy Proposes Debt Settlement After 98% Stock Value Collapse
Israeli smart glass company Gauzy, which debuted on Nasdaq just two years ago with a valuation of $319 million, has seen its stock plummet by approximately 98%, now trading at under $7 million. The company recently informed investors and creditors of a proposed debt restructuring following a bankruptcy petition filed by former employees. Gauzy has also faced Nasdaq warnings due to its low share price and failure to publish financial reports since Q2 2025.
Founded in 2009 by CEO Eyal Passow and CTO Adrian Loffer, Gauzy developed unique technology to control light transmission through transparent surfaces, targeting aviation, automotive, and architectural sectors. The company expanded into automotive safety systems (ADAS) through a French acquisition. However, in November last year, Gauzy encountered financial distress, with bankruptcy proceedings initiated against three subsidiaries in France, which the company contested. This led to delayed financial reporting and further financial deterioration, including unpaid salaries and creditor lawsuits.
Gauzy's proposed debt settlement includes a private investment in public equity (PIPE) of $7 million led by Chutzpah Holdings, headed by Alejandro Weinstein. The plan requires approval from over 51% of creditors and 75% of total debt holders, plus court sanction. It offers two repayment mechanisms: a full payout from an exit event exceeding $330 million, or annual payments of 25% of net profits until debts are cleared if operational profitability is achieved before an exit.
The settlement prioritizes secured creditors such as OIC and Mizrahi Tefahot Bank, followed by Israeli tax authorities, National Insurance Institute, and suppliers. Trade creditors will be paid in up to 60 installments after six months. Employees and former staff owed wages will receive full payment upon PIPE completion. The investment proceeds will cover interim creditor payments, including salaries, general working capital, settlement-related expenses, and $1 million for recent payroll funding.
Completion of the PIPE depends on maintaining Nasdaq listing and resuming annual financial disclosures, alongside court and creditor approvals. CEO Passow previously announced a $15 million financing agreement hindered by the French legal proceedings. Gauzy's situation exemplifies one of the most significant recent failures of an Israeli public company.
