Another company from the 2020-2021 technology flotation wave reached the end of the road on the stock exchange with a painful loss for investors. The company in question this time is Glass box (TASE:GLBX), which provides browsing data analytics for websites and smartphone applications.
The company stated that it will be sold for 500 million shekels to Alexander Assem Alicorn Venture Capital Partners, founded in 2017, invests in growth technology companies mainly in Israel and the United Kingdom. The acquisition by Alicorn, a previous investor in Glassbox, is expected to be completed by the third quarter of 2024. According to the report, Glassbox's current management team will be retained under the new ownership.
Glassbox was founded in 2010. After laying off 21% of its workforce last year to cut losses, it employed 241 people at the end of March this year.
Glassbox CEO Yaron Morgenstern said in the acquisition announcement that the exit “heralds an exciting and important period in the company’s development” and adds that it represents a “strong vote of confidence,” but investors in Tel Aviv will see things differently. For them, this is a business failure, as the company will be sold at a loss of 57% of the float price. Glassbox will be sold to Alicorn for NIS 41.30 per share, after the company floats on the Tel Aviv Stock Exchange in June 2021 at NIS 95.04 per share, or a post-cash valuation of more than NIS 1.1 billion.
In fact, the company's stock price fell more than 80%, but rose more than 100% last year after a simplification program and the end of a battle within its management.
It all started when a major shareholder called Ibex Investors, who currently owns 32.2% of the company, filed a lawsuit to have a director appointed on his behalf to the board of directors. The suit was dismissed last November after Ibex Investors had its way, and three directors on its behalf and on behalf of other interested parties joined the board.
Last year, Glassbox launched two AI-based tools, and sees this area as an important source of revenue in the future.
In its 2023 financials, Glassbox reported a 17% increase in annual recurring revenue (ARR) to $57.3 million, a good result, but in the flotation prospectus it published in early 2021, it forecast annual recurring revenue at $100 million. Within two to four years. In its most recent financial statements, this target has been postponed to sometime “during 2026.”
Glassbox reduced its operating loss by 55% in 2023 to $10.5 million, while its net loss was $16.6 million, down from more than $33 million the previous year. It also reduced its cash burn to $4 million from $16.3 million a year earlier, and has more than $20 million in cash.
Published by Globes, Israel Business News – en.globes.co.il – on May 19, 2024.
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