Israeli Firm Mellanox Aims to Bring Palestinian Staff to Nvidia After Takeover

The 140 are currently employed through an outsourcing firm, but the Israeli chip maker wants the U.S. company to employ them directly

Ruti Levy
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A server room at the Mellanox building in Yokneam, March 4, 2019.
A server room at the Mellanox building in Yokneam, March 4, 2019.Credit: AMIR COHEN/ REUTERS
Ruti Levy

Mellanox, the Israeli maker of data center chips, is working to ensure that 140 Palestinians now working for it through an outsourcing firm will be employed directly when the company is sold to U.S. company Nvidia, the executive responsible for Mellanox’s operations in the Palestinian Authority said on Thursday.

Sources at Mellanox told TheMarker that the Palestinians qualify for share options even though they are not employees, which means together they can expect to profit between $3.5 million and $4.5 million. Nvidia agreed in March to buy Mellanox for $6.9 billion, but it still waiting for approvals to complete the deal.

Speaking at the XR for Peace conference, the Mellanox executive, David Slama, noted that more than 3,000 Palestinians complete degree programs in engineering and technology every year. Some find work with Palestinian, Israeli and international companies locally and others find jobs in the Gulf, but 75% can’t find employment in their field at all.

The XR for Peace event, a hackathon for developing artificial and virtual reality solutions to conflict resolutions, was held at IDC Herzliya in collaboration with the U.S. Embassy in Israel and the Friedrich Nauman Foundation.

Facing a shortage of skilled software workers in Israel, Mellanox began subcontracting work to Palestinians a decade ago via the Palestinian outsourcing company ASAL, Slama said. It started with five workers.

“We are aiming to reach 200 workers in the coming year,” he said. The Palestinians are integrated into teams involved in software and hardware development, quality assurance, hardware, customer support and operations. They work from offices in Rawabi, Nablus and Hebron in the West Bank, and even from the Gaza Strip. The workforce is 75% male and the average age is 25.

Salma attributed the decision by Mellanox to employ Palestinians, rather the outsourcing to Eastern Europe or Asia, to several factors, among them contributing to the Palestinian economy. “The cost of labor in Asia and here is the same, but here we have the advantage of being able to have face-to-face meetings and being in the same time zone,” he said.