Welcome to the major leagues of debt. Collateralized debt obligations, almost always referred to as a CDOs, are horrendously complicated deals that often leave anyone without a MBA wondering what was put into these CDOs.

The first thing to understand about bonds, (aka debt) is that bonds are often backed by something else. Think about your home mortgage. If you don't pay your mortgage, the bank can take the house. You end up homeless, and the bank sells the house to pay off the rest of that mortgage. There is something "backing" that mortgage; something lender can fall back on, if you don't pay your bills like a good human being. That's called collateral.

CDOs are one flavor of an entire sector of investing called structured finance, and they are also backed. CDOs, in the simplest concept, are just bonds backed by something else. In most cases, a CDO is backed by a collection of various types of debt. CDOs can be home mortgages, or other types of debt like credit cards, auto loans, and personal loans. Most of these types of debt are usually considered a bit more risky and they don't have the backing that a home loan does. So, if you think it through, you can imagine that CDOs are usually considered a risky investment.

To take a step further, understand that CDOs have multiple flavors within each CDO. These flavors are called tranches. If you've taken French, you might recognize the word, it means "slice" or "portion." Each slice of that CDO you invest in is a little different and carries different amounts of risk.

You could invest in the lowest risk tranche of the CDO, which would provide you lower risk. But, you don't get a good return on that investment. Or, you can be the heroic adventurer of bonds and invest in the lowest-grade tranche of the CDO. You'll make an amazing return, but if the economy even looks at you wrong, you might lose the entire investment.

CDOs aren¿t easy, and are almost always invested in by mutual funds, insurance companies and hedge funds. As an individual investor, you will probably not come across a CDO you can participate in.

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Sunday, June 22, 2008

Elron Completes Partial Tender Offer for Cash for Given Imaging

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Comtex

TEL AVIV, Israel, Jun 22, 2008 (BUSINESS WIRE) ----Elron Electronic Industries Ltd. (NASDAQ:ELRN)(TASE:ELRN), announced today that it has successfully completed its previously announced tender offer to purchase 1,462,640 ordinary shares of Given Imaging Ltd. (Nasdaq & TASE: GIVN) at $16.54 per share, net to the seller in cash, less any required withholding taxes and without interest. The tender offer, which commenced on May 16, 2008, expired on June 20, 2008 at 10:00 a.m., New York time, or 5:00 p.m., Israel time.

Elron has been advised by the depositaries for the tender offer that, as of the final expiration of the tender offer, a total of 5,330,044 Given Imaging shares had been validly tendered pursuant to the offer representing approximately 18.2% of the issued share capital of Given Imaging. As contemplated in the offer to purchase, Elron has accepted for purchase 1,462,640 tendered Given Imaging shares comprising as of June 16, 2008, 5% of Given Imaging's issued and outstanding shares and voting rights, on a pro rata basis based on a pro ration factor of 0.2744, from all shareholders who have validly tendered their Given Imaging shares.

Payment for the Given Imaging shares accepted will be made promptly through American Stock Transfer & Trust Company or Clal Finance Batucha Investment Management Ltd., the depositaries for the tender offer.

After payment for the Given Imaging shares tendered in the offer and accepted for payment, Elron will beneficially own 9,464,820 ordinary shares of Given Imaging, representing approximately 32.4% of the issued and outstanding shares and voting rights of Given Imaging, or 48.5% when taken together with 4,719,528 additional ordinary shares beneficially owned by affiliates of Elron.

Elron Electronic Industries Ltd. (TASE & NASDAQ: ELRN), a member of the IDB Holding group, is a leading Israel-based technology holding company directly involved in the long-term performance of its group companies. Elron identifies potential technologies, creates strategic partnerships, secures financing, and recruits highly qualified management teams. Elron's group companies currently comprise a diverse range of publicly-traded and privately held companies primarily in the fields of medical devices, information & communications technology, clean technology and semiconductors. For further information, please visit www.elron.com.

Any statements in this press release that may be considered forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially. Actual results may differ from such forward-looking statements due to the risk factors discussed in periodic reports filed by Given Imaging and Elron with the Securities and Exchange Commission, which Elron urges investors to consider. Elron undertakes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

SOURCE: Elron Electronic Industries Ltd.

Elron
   Electronic Industries Ltd. Rinat Remler, 972-3-6075555 Vice President & CFO elron@elron.net

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