Netafim, the Israeli firm that is one of the world’s biggest suppliers of irrigation technology, announced Wednesday that it had received half a billion dollars in financing for the establishment of new projects in developing companies, including India, China, Brazil and Africa.
With the financing, said Netafim CEO Ran Maidan, the company will engage in “engage in strategic growth” in developing markets, and significantly increase its involvement in large irrigation projects.
The financing consists of a $150 million long-term loan and $350 million of revolving short term loans and lines of credit for working capital and project-related guarantees, supplied by Israeli and foreign banks, including HSBC, Mizrahi-Tefahot Bank, Migdal Insurance and Financial Holdings, Union Bank of Israel, and Israel Discount Bank.
Not all of the many farmers who use drip irrigation know much about the company that supplied it and its effect on world agriculture. Numerous studies name drip irrigation as a key ingredient “to have a significant impact on resources saving, cost of cultivation, yield of crops and farm profitability,” in India and elsewhere, according to Indian academics. As the world’s largest drip irrigation technology manufacturer, Netafim can take much of the credit for those results.
Started in 1965, Netafim operates in 150 countries through 37 subsidiaries, with 13 factories throughout the world. The company has 3,000 employees, 2,000 of whom are employed in the company’s manufacturing plants.
In line with its objective of bringing drip irrigation technology to the farthest corners of the world, Netafim’s Indian subsidiary has been working on a contract a drip-irrigation project in the Bagalkot district of India’s North Karnataka state, located in the country’s west. When completed, the Ramthal (Marol) integrated micro-irrigation project will cover nearly 30,000 acres, covering 22 villages and benefiting around 6,700 farmers – making it the world’s largest single drip irrigation project. According to Netafim, the project is worth about $60 million.
“The agricultural market in general, and drip irrigation in particular, sits at the heart of a number of important global issues,” said Maidan. “These include increasing demand for food, due to rapid world population growth, while the planet’s water and arable land resources are finite. At the same time, the agricultural sector is the world’s main consumer of water. As a result, there is a growing demand for better and advanced irrigation solutions and greater agricultural efficiency.
“These trends, along with Netafim’s unique global presence and innovative, high-quality products, present us with a significant growth opportunity. This financing agreement will enable us to realize such growth potential.”