Kibbutz Yizrael to Lose Control of Mitronics After 98% Stock Value Drop

Trading in Mitronics shares, controlled 56% by Kibbutz Yizrael, did not open this morning following the company's announcement of an upcoming material event report. Reports indicate negotiations are underway between the pool cleaning company and the private equity fund FIMI, owned by Yishai Davidy, regarding a potential transfer of control. This possible sale comes after Mitronics' stock plummeted nearly entirely from its peak value over recent years, currently valued at just 187 million shekels.

At its height during the COVID-19 pandemic, Mitronics commanded over half of the global pool cleaning robot market and reached a market capitalization of 9.1 billion shekels. The pandemic-driven surge in demand for home pool cleaning robots fueled significant revenue growth and profitability, with each of the kibbutz's 300 members holding shares worth approximately 17 million shekels at the peak. Today, the combined value of their shares has fallen to about 100 million shekels, or roughly 300,000 shekels per member.

The post-pandemic period brought challenges including excess inventory and competition from cheaper Chinese robots, leading to a sharp decline in orders and profitability. Distributors and retailers, mainly in the US and Europe, were left with large unsold stock, causing order cancellations and profit warnings. Mitronics has since implemented cost-cutting measures and investment plans aimed at regaining long-term relevance.

The potential sale to FIMI would mark a significant shift in ownership after years of decline. The company’s announcement and the trading halt underscore the importance of the forthcoming report, which investors and market watchers await closely.