Netafim Irrigation Systems to Raise $250 Million
irrigation systems is exploring the possibility of raising up to $ 250 million through domestic
or foreign bonds as well as credit facilities totalling $ 150 million. Funding
will be used to recycle existing debt of $ 230 million.
is controlled by foreign private equity fund Permira and is engaged in the
development and marketing of drip irrigation systems and operates in 110
countries worldwide through 31 subsidiaries. The company has an annual turnover
of $ 800 million and employs approximately 4,000 workers.
bonds will also be used to finance the business operations of irrigation but
will not be used for repayment of loans or for the benefit of shareholders
to data, EBITDA (operating cash profit) of Netafim in 2013 dropped to 11%,
compared to 13.5% in 2012. The company's profitability in recent years has been
adversely affected by fluctuations in foreign exchange rates.
note that efficient water use and improvements in productivity associated with
using drip irrigation solutions is likely to increase the demand for such
products in the near future. Netafim is recognized as a global leader in drip irrigation
systems and it is believed that this development
represents a big growth opportunity for the company.
company is expected to maintain its leading market position in drip irrigation
equipment, while maintaining the ratio of FFO (operating cash flow) debt
exceeding 12%, in accordance with its operating base.
been reported that Netafim is in advanced negotiations to clinch a deal worth
about $ 200 million to supply pumping systems and underground drip irrigation to
an Ethiopian government sugar cane company. The deal will be financed by a consortium
of Israeli financial institutions led by Bank Hapoalim.
ago Permira fund bought a 61% stake in Netafim at a company value of $ 850
million (of which $ 360 million was in cash and a loan of $ 150). A group of
selling shareholders in the transaction included the kibbutzim Magal, Iftach