CEO Buys 79% of Bulletproof Material Firm for NIS 790 Million

Daniel Blum, the chief executive of FMS Enterprises Migun (TASE: FMS), which makes lightweight ballistic protective materials, has bought 79.6% of the company for NIS 791 million.

The deal priced the share at NIS 143.8, which was FMS's closing price Wednesday. FMS stock climbed 0.6% on Thursday.

FMS manufacturers protective textiles, sheeting, and armoring for cars. It was one of the few successful share flotations in 1993.

Its principal clients are armies and civil security establishments. FMS stock has soared 1,700% in the past five years. Despite this, there are few parties that fully understand its field of expertise, so it is not surprising that the company's own CEO has decided to take it on board.

FMS has been ranked as number one by data company Dun & Bradstreet for its financial reporting, based on its financials and profits. The company indeed resembles a high-tech star, with profits reaching NIS 170 million in the years 2001-2003, on revenues of NIS 585 million. The company's operations have grown by an average of 20% in recent years.

However, Blum is an unknown commodity, rarely meeting market analysts. The CEO does not release press statements, nor employ a spokesman.

Sector analysts believe FMS will be considering a change of strategy following the particular growth in the sector, led by the U.S. defense tenders. FMS has acted as a subcontractor in several deals, and this has led to the company showing a 36% growth rate in the first quarter of 2004. As a result, FMS works on a three-shift schedule, and recently added a production line in Kiryat Arye, Petah Tikva, to cope with the demand.

Blum bought the shareholding from International Promil, a Uruguayan company owned by Dudu Herberto Donner. The Blum family also owns Fibrotex, a private company, situated in Ramat Siv, Petah Tikva, which is considered one of Israel's leading manufacturers of curtains, panels and upholstery.