Netafim in merger talks to buy Naan

Netafim, the world's largest company in the field of low-volume irrigation (below 550 liters per hour), has initiated talks to buy Naan Dan Agro-Pro for NIS 150 million.

Netafim, whose annual turnover could reach $400 million in 2006, is the world leader in a market estimated to be worth $1 billion. However, some of its revenue stream comes from supplying greenhouses.

Naan Dan's annual sales are between $75 and $80 million, and the company is thought to have broken even in 2005. The company, which is 70 percent owned by Kibbutz Na'an, develops and markets drip, spray and sprinkler irrigation systems. It also implements turnkey projects.

The acquisition of Naan Dan, with its spray and sprinkler watering systems, would broaden Netafim's product mix. Naan Dan also manufactures and markets circular drip units, which are currently not part of Netafim's offerings.

If the deal goes through, Naan Dan would give Netafim a presence in the Spanish market through its 50 percent-owned subsidiary, as well as solidifying the company's hold in the American and Italian markets.

Netafim is also negotiating to buy Revaho, a Dutch company that is considered a world leader in the manufacture and marketing of greenhouses and also serves as a distributor of irrigation systems. Revaho, which was founded in 1937 and is based in Maasland, the Netherlands, markets Netafim's products. This acquisition would give the Israeli company a springboard for growth in the British, Romanian and Korean markets.