Netafim's expanded Fresno operation includes a distribution center opened in 2015, in this photo from johnsonair.net.
Written by David Castellon
Mexican piping and chemical company Mexichem, SAB, has announced a $1.5 billion deal to buy the Israel-based irrigation company, Netafim, LTD, which includes its U.S. division based in Fresno.
The deal will give Mexichem an 80-percent stake in Netafim, while its founder, Kibbutz Hatzerim, will retain the remaining 20 percent interest in the company valued at $1.89 billion.
Netafim is the world’s largest irrigation company, developing, manufacturing and selling micro and drip irrigation systems around the world, with offices in more than 120 countries.
The company also offers crop management technology and software.
In 2015 the company expanded its Fresno operations with a 102,000-square-foot distribution center at its Fresno location near Fresno Yosemite International Airport, according to published reports, which also state Netafim USA employs about 300 people.
“In the past few years it has achieved strong financial performance, with top-line growth and improving profitability reaching total sales of $855 million for the year ended December 31, 2016,” according to a press release issued by Mexichem.
The purchase is expected to be finalized late this year. Mexichem is a manufacturer of plastic pipes and petrochemicals with applications in construction, infrastructure, agriculture, healthcare, transportation, telecommunications and other industries.
The company employs more than 18,000 people in more than 30 countries where it operates 120 production plants, according to its website.
“This is a transformational acquisition that advances Mexichem’s drive into specialty products and solutions and establishes us as a leading innovator in the high-growth, micro-irrigation market,” Antonio Carrillo Rule, Mexichem’s CEO, said in a press release.
“At the same time, Netafim positions us to become a leading developer of solutions to address food and water shortages and respond to the need of increased crop yields and meet higher sustainability standards for fertilization,” as well as giving the company access to smart technology that can be applied to heating and cooling, water management, data communications and other sectors, the release continues.
Officials at Netafim U.S.A. in Fresno couldn’t immediately be reached to comment on how the acquisition may affect operations here, but Netafim CEO Ran Maidan told Reuters news service, “The company will remain independent. The management team and myself will keep running the company.
“We will be able come with all the advantages of being a part of a group, and on the other hand we will maintain Netafim’s independent character and identity.”