Naandanjain: Every Drop of Water Counts

18 Pages Posted: 30 May 2017 Last revised: 9 Oct 2018

See all articles by Peter Marcel Debaere

Peter Marcel Debaere

University of Virginia - Darden School of Business; Centre for Economic Policy Research (CEPR)

Allison Elias

University of Virginia - Darden School of Business

Abstract

This case demonstrates the growing importance of water policy and water scarcity on key business decisions. It uses the merger of two drip irrigation companies to show how the business models of multinationals were shifting to accommodate current and expected water crises in many parts of the world. In 2012, Jain Irrigation Systems, a multinational founded in India, became sole owner of the Israel-based NaanDan Joint Venture, a privately held, well-respected irrigation technology firm. The creation of NaanDanJain evidenced the increasingly visible role of India as a global player whose multinationals acquired high-tech companies from more advanced economies. But more important for this case, when considering demographic and economic variables for each country, the merger illustrated the challenges of providing irrigation to small farmers. This case situates the formation/establishment of NaanDanJain within the divergent water policies and water practices of Israel and India.

Excerpt

UVA-GEM-0122

Rev. Sept. 21, 2018

NaanDanJain: Every Drop of Water Counts

Sometimes, globalization manifested itself in unexpected ways that at first seemed odd, but upon reflection made perfect sense. For the people from Kibbutz Naan, a community near Rehovot, Israel, of some 1,000 residents, the new normal was a switch in diet when the Jain family of India visited on business. Because the Jains adhered to a strictly vegetarian diet, dinner consisted of hummus and falafel instead of the regular Israeli diet of poultry, red meat, fish, eggs, and root vegetables. The family owned Jain Irrigation Systems (known as Jain Irrigation or simply Jain), a multinational firm that was headquartered in Jalgaon, India. In 2012, Jain employed more than 7,000 people globally and had sales just short of $ 1 billion (see Exhibits1a and 1b). In 2007, Jain had acquired 50.001% of NaanDan, a privately held, well-regarded irrigation technology firm that had more than $ 75 million in sales; five years later, Jain became its sole owner. In the wake of the acquisition of NaanDan, Jain Irrigation renamed the company NaanDanJain (see Exhibit1c).

There were multiple ways to look at the merger between Jain and NaanDan. One could perceive the merger as further evidence of how far Jain had come. Its flexible business model had adapted to every challenge posed since Bhavarlal H. Jain founded the company in 1963, and acquiring NaanDan was a logical next step. From the perspective of many Israelis and outside observers, the merger emphasized the increasingly visible role of India as a global player whose multinationals acquired high-tech companies from more advanced economies. But more than anything, the merger made sense when considering NaanDan's product line and expertise. From that angle, the merger of the two companies was about irrigation, and in particular drip irrigation, going global. This business decision represented a global response to the current and/or expected water crises in many parts of the world.

Irrigation in Israel

. . .

Keywords: drip irrigation, water, India, Israel, sustainability

Suggested Citation

Debaere, Peter Marcel and Elias, Allison, Naandanjain: Every Drop of Water Counts. Darden Case No. UVA-GEM-0122, Available at SSRN: https://ssrn.com/abstract=2974633

Peter Marcel Debaere (Contact Author)

University of Virginia - Darden School of Business ( email )

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

HOME PAGE: http://www.darden.virginia.edu/html/direc_detail.aspx?styleid=2&id=5794

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Allison Elias

University of Virginia - Darden School of Business

P.O. Box 6550
Charlottesville, VA 22906-6550
United States

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