Orbia focuses its strategy towards «human-centered» solutions
The Mexican company Orbia reported that it is increasingly focusing its business strategy towards «human-centered» solutions.
Orbia’s business groups are Precision Agriculture (Netafim), Data Communications (Dura-Line), Building and Infrastructure (Wavin), Fluor (Koura) and Polymer Solutions (Vestolit) that collectively seek:
- Guarantee food safety.
- Reduce water scarcity.
- Reinventing the future of cities and homes.
- Connect communities to data infrastructure and expand access to health and wellness with advanced materials.
Ultimately, the company puts the customer and their needs at the center of its strategy, to develop increasingly specialized, technological and innovative products and increasingly solutions known as «human-centered», in which Orbia has identified and can continue to identify pressing challenges.
At the same time, Orbia has adopted greater discipline regarding the investment decision in both organic and inorganic projects through a capital allocation model that includes risks, mitigations, alignment to Orbia’s strategy as a first filter. , global and local growth potential, profitability and operational capacity.
Orbia and contingencies
Netafim currently has a government irrigation project in the Tigray region of Ethiopia with client Ethiopian Sugar Corporation (ESC), referred to as the “Wolkaite” project, which is in an advanced stage.
Due to civil unrest, this region has been in a state of emergency since November 4, 2020.
Towards the end of November 2020, Netafim notified ESC, creditors, insurers and other interested parties that, due to force majeure caused by these civil disturbances, Netafim’s contractual obligations in relation to this project were being suspended.
Under the original project agreement, if force majeure conditions continued for an extended period of time, either party would have the right to terminate the agreement.
Then, on July 1, 2021, the parties entered into a Memorandum of Understanding (MOU) that suspended until December 30, 2021, the right to cancel the project agreement due to force majeure conditions in force.
Such suspension applies even if the force majeure conditions were to end prior to December 30, 2021.
The MDE also establishes a period for the parties to make an evaluation of the condition of the works and try to reach an agreement to resume the works.
Currently, all parties involved are cooperating and monitoring this situation. In addition to potential costs derived from project delays and possible damage to existing works, Netafim may incur additional liabilities under certain scenarios.
Profile
Orbia has commercial activities in more than 100 countries and operations in 41, with offices in Mexico City, Boston, Amsterdam and Tel Aviv.
Orbia is a leading provider of products and solutions in multiple sectors, including construction and infrastructure, agriculture, health, transportation, telecommunications, energy and chemicals, among others.
In addition, it is one of the largest producers of plastic pipes and fittings worldwide and one of the largest chemical and petrochemical companies in Latin America.
The main products of the Company are: PVC, polyethylene (PE) and polypropylene (PP) pipes and fittings, high density polyethylene (HDPE), irrigation drippers and geosynthetics; as well as fluorite, fluorocompounds, hydrofluoric acid, refrigerant gases and medical propellants, and finally resins and polyvinyl chloride (PVC) compounds, among others.
