from the June 2011 issue

Permira buys drip copy Netafim for $850m.

In a surprising development this weekend, the privately-held European investment fund Permira closed a deal to buy out four of irrigation technology company Netafim's five main shareholders.

Permira is buying out the interests of Markstone (20% ), Tene (10% ), and the kibbutzim Magal (24% ) and Iftach (8% ), for about $530 million. The deal prices Netafim, a pioneer in drip irrigation technology systems, at $850 million, not including the company's debt. Including the debt, the deal prices Netafim at about a billion dollars.

Left outside the deal is Kibbutz Hatzerim, which owns 38% of Netafim.

None of this means the deal is done: Hatzerim has a right of first refusal to buy out its partners in Netafim. It can either grant the buyout its blessing or meet the price. Netafim was founded 45 years ago in Kibbutz Hatzerim. Over the years certain divisions have been sold off.

Reprinted from the Israel High-Tech & Investment Report June 2011

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