Mexichem Completes 80% Acquisition of Drip-Irrigation Company Netafim
The deal values the Israel-based drip-irrigation pioneer at $1.9 billion
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With annual revenues of $5.35 billion and around 18,000 employees, Mexichem is one of the largest chemical and petrochemical companies in Latin America.
Mexichem bought its shares from London-based private equity firm Permira, which acquired 61.3% of Netafim’s shares in 2011, and from two Israeli Kibbutzim.
Hatzerim, a Kibbutz in Israel’s south and one of Netafim’s major stakeholders, will retain 20% ownership in the company.
Established in 1965 in Israel, a country suffering prolonged water scarcity, Netafim is the largest drip-irrigation manufacturer in the world. The company has 17 manufacturing plants and almost 30 subsidiaries in Israel and abroad, and employs around 4,500 people.
“The partnership with Mexichem will create a major step forward for Netafim, and will enable us to accelerate growth, while providing a more comprehensive set of solutions and services to our customers,” said Netafim President and CEO Ran Maidan in a statement. He added that Netafim’s headquarters and core activities will remain in Israel “for many years to come.”
“Netafim adds an important element to Mexichem’s strategic profile. In addition to making us the leader in the fast-growing micro-irrigation market, Netafim brings R&D and technology to transform existing products in our portfolio into smart solutions that can assist our end customers in managing their networks and operating sites,” said Mexichem CEO Daniel Martínez-Valle in a statement.
In the bidding for Netafim, Mexichem beat Singapore's governmental holding company Temasek Holdings, Connecticut-based toolmaker Stanley Black & Decker, and Annapolis, Maryland-based industrial corporation Colfax, according to previous Calcalist reports.