Formula Ventures Completes an Interim Round of Financing, Increasing the Formula Ventures Fund Size to Approximately 65 Million US Dollars

HERZLIYA, Israel, Aug. 11 /PRNewswire/ -- Formula Systems (1985) Ltd. (Nasdaq: FORTY - news), a leading international provider of information technology, products and services, announced today that its venture fund, Formula Ventures, has completed an interim round of financing that increases the Formula Ventures fund size to approximately $65 million. Formula Ventures is an Israel based venture capital fund, focusing on early stage information technology ventures.

Formula Ventures was founded in December 1998 by Formula Systems. Formula Systems increased its commitment to the fund, in the last round, to $15 million.

"Formula Ventures is our investment vehicle in the Israeli start-up opportunity and the enormous energy and talent inherent in this marketplace makes this investment avenue an important building block of Formula's strategy," said Dan Goldstein, Chairman of the Board of Formula Systems.

"We are gratified by the quality of the investors in the Venture Fund. Some of them are extremely well known, reputable organizations in the global business community," said Mr. Goldstein.

Mr. Goldstein said, "We consider the success of this round of financing a vote of confidence in Formula Systems and in its management's ability to identify and enhance the performance of start-ups with the potential for outstanding achievements. We expect Formula Ventures to leverage the extraordinary reputation that Formula Systems has in the information technology community in Israel."

Formula Ventures focuses its investment strategy on early stage IT ventures and currently counts eleven companies in its portfolio, primarily in the areas of e-business, enterprise software and enabling technologies.

Formula Ventures intends to complete its fundraising activities in mid-September, 1999.

Formula Systems (1985) Ltd. is a global information technology company principally engaged, through its subsidiaries and affiliates, in providing software consulting services, developing proprietary software products and providing computer-based business solutions.

This press release contains forward-looking statements. Such statements involve various risks that may cause actual results to differ materially. These risks and uncertainties include, but are not limited to, market demand for the Company's products, successful implementation of the Company's growth and the ability to recruit additional personnel.