Tel Aviv builds with Tata

The deal looks be the first of many investments in Israel from Tata, and promises to be a major boon for Tel Aviv’s commercialisation efforts.

Ramot, TAU’s tech transfer unit, has signed a Memorandum of Understanding (MoU) with Tata Industries to fund and generate ‘commercialisation ready’ technologies in a number of fields aligned with the engineering conglomerate.

According to the MoU, Tata Industries will be the lead investor in Ramot’s $20m Technology Innovation Momentum Fund, which will be used to invest in developing technologies in sectors in which Tata operates, such as engineering, environmental and clean tech, pharma, and life sciences.

Ramot covers a wide remit itself, with TAU feeding it technologies from a number of sectors, including agriculture, pharma, mechanical engineering, and several other areas, backed by TAU investing $150m a year into research and development. Its successes include optical fibre firm Polymicro Technologies, and Brainstorm Cell Therapeutics. However, the TAU’s biggest win came when SanDisk acquired flash memory technology licenced to an Israeli company which still provides TAU with millions of dollars in royalties. Sandisk is the only company in the world with the rights to both manufacture and sell every major flash card format, and saw its revenues reach $3.9bn in 2007.

During the due diligence process prior to the deal, Tata were shown more than 70 innovations, according to Tata Industries chief executive KRS Jamwal.

Jamwal said: “Tata has taken the decision to partner with Ramot and TAU with a desire to enhance capabilities of Tata companies and leverage technology as a differentiator for our businesses.”

The deal is also Tata’s first major investment in Israel. “This is our attempt to scout Israeli technology more deeply,” explained Jamwal, who said the firm is likely to invest further into the country. “This allows us over a period of time to show our commitment to Israel but we are interested in doing more.”

Another upside of the deal for Tata is the ability for the company to oversee what technologies are being developed and to pick and choose which innovations are taken forward, allowing the firm to essentially steer TAU and Ramot’s work towards technologies with market relevance.

“It’s someone to test your ideas and say what’s a mistake,” said Shlomo Nimrodi, Ramot’s chief executive. “Tata knows the market better.”

He added: “Being a lead investor, Tata will be able to see a pipeline of technologies. They will have an option to commercialize certain promising opportunities from TAU. The diversity of innovation at TAU, coupled with Tata’s uncompromising commitment, creates a major opportunity to impact communities across the world.”

It is likely to be the first of potential many other such partnerships to be struck between corporations and university venturing activities.