MIRA INFORM REPORT
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Report Date : |
24.06.2011 |
IDENTIFICATION DETAILS
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Name : |
JOHN DEERE WATER LTD. |
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Formerly Known As : |
PLASTRO IRRIGATION SYSTEMS LTD |
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Registered Office : |
M. P. Haamakim, GVAT 30050 |
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Country : |
Israel |
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Financials (as on) : |
31.03.2008 |
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Date of Incorporation : |
31.08.1967 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Developers, Manufacturers, Exporters and Marketers of plastic pipes, drip
irrigation systems and other water systems plastic accessories. |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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Payment
Behaviour : |
No Complaints |
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Litigation : |
Clear |
NOTES :
Any query related to this report can be made
on e-mail : infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – March 31st, 2011
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Country Name |
Previous Rating (31.12.2010) |
Current Rating (31.03.2011) |
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Israel |
a2 |
a2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
Company name & address
JOHN DEERE WATER
LTD.
Telephone 972
4 654 94 44; 644 96 50
Fax 972
4 654 09 83; 644 93 15
M. P. Haamakim
GVAT 30050 ISRAEL
HISTORY & LEGAL FORMATION
Originally established as a General Partnership and registered as per file No.
54-039413-3 on the 31.08.1967 by Kibbutz Gvat, under the name
PLASTRO GVAT.
On the 01.01.2001 all activities were transferred an Agricultural
Cooperative Society, registered as per file No. 57-003799-4 on the 29.11.2000,
under the name PLASTRO GVAT AGRICULTURE IRRIGATION INDUSTRIES LTD., which
changed to PLASTRO IRRIGATION ACS LTD. on the 11.12.2002.
On the 03.05.2004
converted into a private limited company and registered as such
as per file No. 51-353930-4, under the name PLASTRO IRRIGATION SYSTEMS LTD.
Later in May
2004, published a prospectus offering shares to the public on the Tel Aviv Stock
Exchange, and following its listing for trade, converted into a public limited
company (registration remained the same).
In June 2008
following a successful purchase offer to the public, subject re-converted into
a private limited company, and shares were de-listed from trade. The purchase
offer was part of the acquisition of subject (via its parent company) by DEERE
& COMPANY, of USA.
On the 15.11.2009
subject changed its name to the present one.
SHARE CAPITAL
Authorized share
capital NIS 1,000,000.00, divided into -
100,000,000 ordinary shares of
NIS 0.01 each,
of which
27,299,553 shares amounting to NIS 272,995.53 were issued.
SHAREHOLDERS
Subject is fully owned by PLASTRO IRRIGATION & INFRASTR
In July 2008 JOHN DEERE Group completed the acquisition of subject for a
reported sum of NIS 245 million (actual price was not disclosed, other reports
indicate a much higher price of NIS 360 million).
DIRECTORS
1.
John Roberts, General
Manager,
2.
Douglas Debris, both
latter are of the USA,
3.
Roni Argi.
BUSINESS
Developers, manufacturers, exporters and marketers of plastic pipes, drip
irrigation systems and other water systems plastic accessories.
Most sales are for export.
Amongst local clients: AMIR SUPPLY CO., Kibbutz MIZRA, Kibbutz Yifat, and
many others.
Amongst suppliers: BERMAD, AMIAD ILTRATION SYSTEMS, KAFRIT INDUSTRIES,
I.P.S ISRAEL POLYMERS SERVICES, I.P.E INTERNATIONAL PROCESS EQUIPMENT, ASDAN
TECH, etc.
Operating from leased premises (offices and plant), owned by Kibbutz Gvat,
on an area of 53,000 sq. meters in Kibbutz Gvat, a locality in the North of
Israel (Mobile Post (or "M.P.", or "D.N." in Hebrew
translation) Haamakim). Also operate from some 14 manufacturing facilities
(fully or partly owned) worldwide.
Note: In 2008 subject also operated from another plant (via subsidiary
HYDROMATIC), on an area of over 3,000 sq. meters (leased), in Ramat Gavriel
Industrial Zone, Migdal Ha'emek. We could not confirm this facility.
In our current investigation, we also did not receive conformation from subject's
officials regarding a/m suppliers and clients (data from the beginning of
2008), however our indications show that this data is still relevant.
Number of employees not forthcoming, believed to be several hundred (was
200 employees in 2008).
MEANS
It should be noted, that subject prior to the acquisition by JOHN DEERE, suffered grave financial difficulties. In May 2008 subject's CPA noted
that due to subject's losses should the a/m acquisition would not materialize,
subject will have to raise credit from other sources to pay its debts.
As the acquisition came through, we assume that financial status improved
significantly, as subject now has been enjoying the financial backing of parent
company DEERE & CO., with current market value US$ 39.56 billion.
Subject is an “Approved Enterprise” and as such enjoys tax benefits and
State incentives. In 1997, the Israeli Investment Center (IIC) approved a US$ 5.5 million investment plan for the expansion of subject’s
plant in Gvat. In November 2008 IIC approved NIS 19 million investment plan for
the expansion of the HYDROMATIC plant in Migdal Ha'emek.
There are 5
charges for unlimited amounts registered on the company's assets, in favor of
the State of Israel local companies.
Consolidated B/S shows (last obtainable, while
subject was still publicly traded and published its statements):
NIS
(thousands)
31.12.2007 31.03.2008
ASSETS
Current assets
Cash
and cash equivalent 13,803 15,734
Customers
173,647 166,612
Other
debtors 36,354 38,194
Stock 135,833 152,581
359,637 373,121
Non-current assets
Investments,
loans and long term debit 32,541 32,475
Fixed
assets (net) 112,174 109,702
Other
assets (net) _32,395 _32,542
177,110 174,719
536,747 547,840
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LIABILITIES
Current Liabilities 333,669 358,135
Long term liabilities 180,221 173,734
Equity _22,857 _15,971
536,747 547,840
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SALES
Consolidated
statement of Income
NIS
(thousands)
For
the year ended 31.12
2005 2006 2007
Sales 375,460 450,431 585,497
Gross profit 132,470 144,741 196,721
Operating profit 27,521 2,147 8,890
Profit (loss) before taxes on income 9,289 (20,964) (25,456)
Net income (loss) 7,976 (20,418) (35,385)
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Consolidated first
3 months of 2008 sales NIS 135,680,000 (4.4% decrease compared to the parallel
period in 2007), making a gross profit of
NIS 46,148,000, an
operating income of NIS 2,327,000, ending with a net profit of NIS 1,058,000.
Later sales
figures not forthcoming.
OTHER
COMPANIES
Note: Since subject's officials refused to disclose
any data, we could not confirm the u/m subsidiaries and holdings (data relevant
to the beginning of 2008)
PLASTRO ARGENTINE,
99.97%
PLASTRO HOLLAND,
100%
GLAXICON LTD.,
100%
METALICON LTD.,
100%
PLASTRO
PHILLIPINES, 100%
PLASTRO CHILE,
100%
PLASTRO BEIJIN,
100%
PLASTRO PERU, 100%
PLASTRO BRAZIL,
100%
PLASTRO EQUADOR,
99%
PLASTRO COLOMBIA,
100%
PLASTRO TURKEY,
99.75%
PLASTRO AUSTRALIA,
85%
PLASTRO INDIA,
32.7%
PLASTRO FRANCE,
100%
PLASTRO SPAIN,
100%.
DEERE &
COMPANY, parent company, together with its subsidiaries (JOHN DEERE) operates
in three business segments: agriculture and turf, construction and forestry and
credit. Subject is part of the Water Segment.
JOHN DEERE concern holdings in Israel also include:
BHC MANUFACTURING
LTD., 100%, manufacturers, exporters and marketers of
agricultural implements for cotton growers and of other implements and
assemblies for the automotive (mainly for 4x4 vehicles), agricultural and
engineering field.
BANKERS
Bank details not forthcoming.
CHARACTER
AND REPUTATION
Since the acquisition, nothing unfavorable learned (prior to that subject
suffered from financial difficulties as mentioned above).
We were unable to
reach subject's officials. We left a message. In the previous interview
officials refused to update data.
Subject (in its
various forms) is long established and well-known in the irrigation field in
the world.
In July 2005 MELLOWBRIDGE of Australia invested NIS 61 million in
subject's former parent (GAN-GVAT, owned by Kibbtz Gvat and Australian investor
John Gendel), in consideration of allocation 50% in subject's former parent
(most capital went to Kibbutz Gvat to cover debts, other than invested in
subject).
In April 2007, after John Gendel decided to sell his holdings in subject,
subject went through turbulence, including complex process of negotiations
involving several parties, until a new holding structure evolved, in which JOHN
DEERE of the USA signed an agreement to take control in subject (75%) in
consideration of US$ 50-60 million.
In May 2007, Kibbutz Gvat acquired Gendel's MELLOWBRIDGE PTY LTD. shares in GAN-GVAT ASSETS LTD. (shares were equally held, and GVAT purchased the
other half of the shares). Finally, in July 2008 DEERE & COMPANY completed the acquisition of subject. As part of the deal JOHN DEERE
committed to keep the plant in the Kibbutz and employ Kibbutz Gvat's members.
In August 2005,
subject acquired ERAL (100%), marketers of irrigation systems to
French-speaking African countries, in consideration of €450,000. The
company controls 83.5% of AQUADOC, marketers of the products in South France.
In June 2006, it
was reported that subject acquired control (70%, with option to reach 100%) of
a French marketing firm THYS, for a sum of NIS 1.2 million. The firm's annual
sales are €3 million.
In October 2006
subject announced the acquisition of the assets of 2 Spanish firms, for €8.3 million.
In January 2010 JOHN DEERE acquired BHC MANUFACTURING
LTD.
(which assumed activities which began in 1952), for US$ 12 million.
The global drip
irrigation market was valued at US$ 1.9 billion in mid 2005, with 5%-10% growth
rate. Israeli companies are considered pioneers and leading industries in the
world, including NETAFIM, NAAN DAN and subject.
The Ministry of
Industry & Trade data published summary of Israel's Plastic and Rubber
Industry in 2009: The Sector’s sales (local and for export) reached US$ 4,090
million (of which some half for export), representing 4% decrease from 2008 (sales
in 2008 also fell from 2007 by 7.3%, after several years of continuing growth –
reaching record sales of US$ 4,596 million in 2007). The fall is explained by
the global crisis that erupted in 2008 2nd half, into 2009.
Sales for export by the Plastic and Rubber Industry badly suffered and
plunged in 2009 by 15% from 2008, but recovered in 2010 with 5.8% growth in
export, reaching US$ 1,615.6 million, as part of the recovery in global
markets.
In general, 30% of the Plastic and Rubber sector's sales are household
products, 23% - agriculture, 16% - packaging, 9% - building sector, 9% to the
industry (rest is to other fields).
Investment in imported machinery and equipment to the plastic and
rubber industry totaled NIS 512 million in 2010, some 8% down from 2009,
continuing the decreasing trend although in a much lesser magnitude, after a
sharp fall of 29% in 2009 from 2008 (then it witnessed a mere 1% increase from
2007).
SUMMARY
Notwithstanding the refusal to disclose financial details, considered good for trade engagements.
Maximum unsecured credit recommended u to several US$ million.
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.44.93 |
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UK Pound |
1 |
Rs.72.09 |
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Euro |
1 |
Rs.64.21 |
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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71-85 |
Aa |
Possesses adequate working capital. No caution needed for credit
transaction. It has above average (strong) capability for payment of interest
and principal sums |
Large |
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56-70 |
A |
Financial & operational base are regarded healthy. General
unfavourable factors will not cause fatal effect. Satisfactory capability for
payment of interest and principal sums |
Fairly Large |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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11-25 |
Ca |
Adverse factors are apparent. Repayment of interest and principal sums
in default or expected to be in default upon maturity |
Limited with
full security |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NB |
New Business |
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This score serves as a reference to assess SC’s credit risk
and to set the amount of credit to be extended. It is calculated from a
composite of weighted scores obtained from each of the major sections of this
report. The assessed factors and their relative weights (as indicated through
%) are as follows:
Financial
condition (40%) Ownership
background (20%) Payment
record (10%)
Credit history
(10%) Market trend
(10%) Operational
size (10%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.