Meertec
Private Equity Wire · 12 Oct 2026
CVC keeps Israeli defence investment low-profile amid controversy concerns
CVC Capital Partners has publicly announced its acquisition of a 40% stake in Israeli defence technology company Fibrotex, amid concerns over potential controversy surrounding the investment, according to a report published by the Financial Times.
The Financial Times reported the Dutch-listed private equity firm has agreed to acquire the stake from Fibrotex’s founding Blum family for approximately €250m, according to people familiar with the matter. Adi Blum, an Israel Defense Forces veteran, will retain an interest in the business.
The investment was led by CVC’s German team through its mid-market Catalyst fund. Unlike the fund’s four previous acquisitions, which were publicly announced, CVC disclosed the Fibrotex transaction only to its limited partners.
According to the FT, the decision reflected concerns about potential backlash over investing in Israel’s defence sector amid the ongoing conflict in Gaza and heightened political tensions.
In its communication to investors, CVC reportedly described Fibrotex as an international business operating in the US, Japan and Australia, without referencing its Israeli headquarters in Petah Tikva.
Following enquiries from the FT, CVC confirmed that Fibrotex had principal operations in Israel and the US, serving customers across more than 20 countries.
The firm said its investment would support Fibrotex’s international expansion and product development, against a backdrop of increasing defence modernisation and security requirements.
Founded in 1965, Fibrotex develops camouflage and concealment systems for military personnel, vehicles, aircraft and naval assets. Its technology is designed to reduce detection by radar and thermal imaging systems.
The transaction represents the largest of five investments signed by CVC Catalyst to date. Israeli newspaper Calcalist previously reported that Fibrotex had appointed Jefferies to explore a stake sale at a valuation of approximately $1bn.
The deal comes amid growing private equity interest in defence-related businesses, driven by increased European military spending following Russia’s invasion of Ukraine.
However, investments linked to Israel’s defence industry face heightened scrutiny from institutional investors and other stakeholders.
Naaguesh Appadu of Bayes Business School’s M&A Research Centre told the FT that controversy did not necessarily make an investment inappropriate but warned that opposition from limited partners and employees represented a genuine risk.
One CVC Catalyst investor reportedly said their assessment of defence investments distinguished between companies producing protective military equipment and those manufacturing weapons.
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