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Applied Materials Ventures to invest in Israel for the first time

Will lead $10 million financing round in Israeli optic communication startup

Corporate VC fund Applied Materials Ventures (Nasdaq:AMAT) will co-lead a seed round of about $10 million for an Israeli optical communications startup, TheMarker has learned.

Julien Nguyen, managing partner in the fund, refused to disclose the company's identity, but said it was in the field of optical integrated circuits (OICs). He says the company will be given a term sheet next week, and that AMV was working to hook it up with leading Silicon Valley venture capital funds.

Applied Materials Ventures was founded in May 2001 and manages $50 million in its AMV I fund, concentrated mainly on communications and optical communications investments.

On the board of AMV are Dan Maydan, founder and president of Applied Materials, CFO Joe Bronson, Sass Somekh, executive Vice President at Applied Materials and the CEO of Applied Materials in Israel, Dan Vilensky.

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AMV has good connections among leading Silicon Valley leading companies and funds, including Cisco Systems (Nasdaq:CSCO), Lucent Technologies (NYSE:LU), Nortel (NYSE:NT), Broadcom Corporation (Nasdaq:BRCM) and Intel (Nasdaq:INTC).A month ago AMV took part in an $86 million financing round for American startup Zepton Networks. Investors that took part in the round were Kleiner Perkins Caufield & Byers, Accel Partners, Benchmark Capital, Sprout, Worldview Technology Partners and Juniper Networks (Nasdaq:JNPR). Known as the world's best VC investor, Vinod Khosla, a general partner at Kleiner Perkins Caufield & Byers, is on the board of Zepton Networks.

Joshua Segal, a principal at AMV, told TheMarker the fund was looking into investing in two other Israeli companies. "We are looking to invest in well managed Israeli companies with revolutionary technology of Zepton's level," said Segal.