Internet service provider Internet Gold (Nasdaq: IGLD) has announced that it will continue to expand e-commerce in Israel by forming an online brokerage with three partners.
Internet Gold, which has approximately 165,000 subscribers, will take an initial 25 percent stake in the joint venture with the A.B. Watley Group (Nasdaq: ABWG), a New York-based brokerage firm.
The companies are joined in the venture by Nessuah Zannex, an Israeli investment firm and a member of the Tel Aviv Securities Exchange, and IFAT Holdings, which holds equity stakes in Israeli companies that are involved in the Internet. These firms, along with A. B. Watley, will also take a 25 percent stake.
Internet Gold said that it has the option to increase its stake to over 50 percent in the future. The companies are investing a collective $1.75 million (US$) initially.
Expanding Israel’s Financial Services Market
“This is our most significant step in online financial trading and services,” said Internet Gold CEO Eli Holtzman. “This is part of our strategy to become not only the leader but one of the innovators in Israel’s online trading and financial services market.”
Internet Gold claims to have its finger on the pulse of the Israeli Internet industry. It serves more than 40 percent of the country’s online market and recently announced the formation of a joint venture with Microsoft (Nasdaq: MSFT) to launch MSN Israel later this month.
The company will own 50.1 percent of the venture, and Microsoft will hold 49.9 percent. The two companies planned an initial investment of $7 million, and will provide news content, search engines, instant messaging, e-mail and business and e-commerce services.
About the Partners
Internet Gold’s Israeli brokerage partner, A.B. Watley, offers two proprietary online trading systems. The company launched its Web site last January and announced 1999 fiscal year revenues of $21 million with a net loss of $650,000.
Nessuah Zannex offers investment banking, portfolio and trust management, the underwriting and management of risk capital funds and a host of additional financial services.