Fortissimo nears $400 million Blackstone deal for RGIS international business
Exclusive: Israeli private equity firm is in talks to acquire control of the inventory services company's operations in Israel and several overseas markets, marking a second major transaction with Blackstone.
Fortissimo Capital is nearing another deal with Blackstone. Calcalist has learned that the Israeli private equity fund is in advanced talks to acquire a controlling stake in part of the operations of RGIS (Retail Grocery Inventory Services), one of the world's largest inventory management companies, which is owned by Blackstone, the world's largest alternative asset manager.
The discussions center on acquiring control of the company that owns RGIS's operations in Israel and several other international markets, at an estimated valuation of around $400 million. In Israel, RGIS operates through ISIC-RGIS, which provides inventory-counting services to retail chains, food companies, importers, fashion retailers, pharmacies, hospitals and industrial manufacturers.
Founded in Michigan in 1958 by Thomas Nicholson, RGIS built its business by providing inventory-counting services to supermarkets and retailers before expanding into dozens of countries. Over the years, it developed proprietary scanning systems and inventory management technologies that allow stock counts to be transferred directly into customers' information systems. Its operations have traditionally relied on thousands of employees conducting inventories in stores, warehouses and logistics centers.
Blackstone acquired RGIS from the founding family in 2006 in a deal reportedly valuing the company at approximately $1.5 billion. Under Blackstone's ownership, RGIS expanded to more than 60 countries and broadened its customer base to include logistics centers, manufacturers and healthcare organizations.
Nearly two decades later, an unusually long holding period for a private equity firm, Blackstone has been gradually restructuring and monetizing its investment. Private equity firms typically hold portfolio companies for around 10 to 12 years before exiting.
The restructuring accelerated in 2021, when RGIS sold its North American operations in the U.S. and Canada to competitor WIS International for an undisclosed sum believed to be in the hundreds of millions of dollars. At the same time, its international business acquired a 95% stake in European inventory specialist Ivalis Group, which at the time generated annual revenue of approximately €73 million.
Today, RGIS focuses on markets outside North America, primarily Europe, the Asia-Pacific region and the Mediterranean. It operates through a combination of subsidiaries and franchisees while retaining ownership of the group's technology, software and inventory management systems.
In Israel, RGIS operates through ISIC-RGIS, based in Rishon LeZion, serving retailers, supermarkets, importers, fashion chains, pharmacies, hospitals, industrial companies and logistics centers. In addition to inventory-counting services, it provides shelf merchandising and inventory loss reduction solutions. The Israeli subsidiary is wholly owned by the international group.
According to the company's website, RGIS operates in 66 countries, serves approximately 3,500 customers and performs around 1,150 inventory counts every day. It says it has completed more than 230,000 inventory projects worldwide and continues to invest in cloud-based inventory management systems and voice-guided counting technologies.
A class-action lawsuit filed against the company about a decade ago described its business model as relying heavily on employees working overnight shifts and traveling extensively between customer locations to conduct inventory counts.
For Fortissimo, the acquisition would mark its second transaction with Blackstone.
In 2024, Blackstone acquired a 70% stake in Israeli enterprise software company Priority Software from Fortissimo and U.S. private equity firm TA Associates in an $800 million deal. Fortissimo and TA each sold 35% while retaining 15% stakes.
The transaction capped one of Fortissimo's most successful investments. The fund acquired Priority, then known as Ashbal Technologies, in 2013 from a court-appointed receiver after the company entered insolvency, paying NIS 192 million. It later sold half its holding to TA Associates in 2020 at a $250 million valuation before Blackstone's acquisition significantly increased the investment's value.
Managed by Yuval Cohen, Fortissimo has raised approximately $2.7 billion across six funds, making it Israel's second-largest private equity firm. Its portfolio spans industrial, healthcare and technology companies, including Cellcom, one of its highest-profile investments. Last week, Cohen said at a Calcalist conference that the fund has no plans to sell its Cellcom stake despite previously exploring strategic options.
Blackstone, which manages approximately $1.3 trillion in assets, opened its Israel office in 2021 under the leadership of former LeumiTech CEO Yifat Oron. The acquisition of Priority was its first major investment in the country.
