jain irrigation

Jain Irrigation manufactures micro-irrigation products at its South Fresno plant. Image via Google Earth

published on July 19, 2022 - 12:02 PM
Written by The Business Journal Staff

A global irrigation manufacturer with early roots in Fresno is in the midst of a merger — creating a company with $750 million in revenue.

Founded in Jalgaon, India, Jain Irrigation employs about 10,500 people and operates 30 facilities across the globe making products for the ag, water and food sectors. Its facility at 2851 E. Florence Ave. in Fresno manufactures irrigation drip tape for farms in the Western U.S.

Jain’s American operations began in 1985 after founder Bhavarlal Jain saw his first drip irrigation system at a farm show in Fresno, according to company lore.

Jain Irrigation announced June 21 it had entered an agreement to merge its international irrigation business with micro irrigation company Rivulis, which started in 1966 on a collective farm in Israel. Rivulis has 16 large-scale manufacturing sites on six continents and three research and development centers in Israel, Greece and San Diego.

The merged company would create the second largest irrigation company in the world with revenue of $750 million. The cash-and-stock transaction leaves Jain with a 22% stake in the merged entity, with the remainder controlled by Singapore-based Temasek, which acquired a majority stake in Rivulis in March.

Temasek’s business portfolio is valued at $283 billion. It is owned by the Singaporean government.

The transaction — expected to close in early 2023 — is part of Jain Irrigation’s quest to deleverage its overseas balance sheet and focus on its rapidly growing business in India. Cash proceeds will allow Jain to reduce its debt by 45%, or $225 million. Jain Irrigation will maintain a long-term supply agreement with the merged company, which will also use and promote Jain brands.

The new company will have 25 factories and 3,300 employees on six continents in 35 countries. It will be dual headquartered in Singapore and Israel and will be named Rivulis Pte. Ltd. For the purposes of corporate branding, the company will be represented as “Rivulis (In alliance with Jain International).”

Richard Klapholz, Rivulis CEO, stated: “We are thrilled to have both companies join forces to better serve the growing needs of irrigation markets around the world. While benefitting from significant operational economies of scale and a dedicated, diverse employee base, we will ensure that all commitments to our grower community and to our combined business partners are maintained and further strengthened. Our goal is to ensure that all our customers will continue to be successful and benefit from a broader offering, leading industry brands, expanded manufacturing base and the support of leading irrigation services businesses. Rivulis, before the merger, represented the combination of four companies, and through this merger, several more companies from Jain Irrigation’s portfolio will be added, cementing our role as a market consolidator and leader across the globe and creating a single company with a much stronger financial foundation.”

Anil Jain, managing director of Jain Irrigation, stated: “We are very happy to enter this alliance with Temasek a globally recognised investment company with values that align with ours on creating sustainable and impactful Hi-tech agri businesses.  We anticipate that the merger with Rivulis will create a world leading player ideally placed to serve its global customer base thanks to its geographic footprint, breadth of offerings as well as technological depth and expertise in micro irrigation. This will enable us all to address climate change and food security challenges with sustainable solutions and implement the critical knowledge transfer for water efficiency and productivity for growers.”

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