U.S. backers of conservative causes may put as much as $150 million into medical-device maker Insightec
Charles and David Koch, the twin brother who have spent hundreds of millions of dollars backing conservative causes in the United States, are making their first investment in Israel through a newly formed high-tech fund.
Koch Disruptive Technologies, a subsidiary of the brothers Koch Industries, led a group of investors putting an initial $75 million into the Israeli startup Insightec. Elbit Imaging a company that is traded on the Tel Aviv Stock Exchange and holds 31% of Insightec, made the announcement on Thursday.
Haifa-based Insightec was not only the first Koch investment in Israel but the first investment of any kind for KDT, which was only formed last month. This investment aligns well with the founding principles of both Koch Disruptive Technologies and Koch Industries, said Chase Koch, KDTs president and Charles Koch's son.
Elbit said the round valued Insightec, which makes non-invasive surgical devices using ultrasound, at $460 million before the money. The Koch-led group has an option to invest another $75 million later. In the meantime, the Koch group will hold a 17% stake.
KDT said the money will be used by Insightec to further commercialize devices for already-approved indications, as well as to continue research in areas such as Parkinsons disease, Alzheimers disease and brain tumors.
Insightecs Exablate Neuro is the first focused ultrasound device approved by the U.S. Food and Drug Administration to treat an essential tremor when it doesnt respond to medication. Clinical research with the company's technology has successfully disrupted the blood-brain barrier, which could lead to targeted drug delivery to treat Alzheimers disease and brain tumors.
Owners of Koch Industries, a closely held Kansas-based conglomerate with interests in oil, industry and farming, the Koches have been major donors to conservative and libertarian causes in the United States since the 1980s, earning notoriety in liberal circles along the way. Last month they helped finance the $1.8 billion takeover of
Time Incorporated by the magazine publisher Meredith Corporation.
Bloomberg estimates the Koch's net worth at $47 billion, placing them in 12th place on the Bloomberg Billionaires Index of the worlds wealthiest people.