Pentair, Ltd., signed an agreement with Saudi Arabia-based construction and contracting firm Ali Abdullah Al Tamimi Company in an effort to increase its existing manufacturing operations in the Middle East.
 
The two companies signed on Tuesday a “memorandum of understanding”—a statement between two parties of mutual agreement on a certain course of action—at the U.S.-Saudi Business Opportunities Forum in Los Angeles. The memorandum indicates that the companies are looking to form a joint venture through which Pentair would establish a “new local presence” to manufacture, sell, and service its products in Saudi Arabia’s Eastern Province.
 
A Pentair spokeswoman told Twin Cities Business that a formal agreement regarding the joint venture will not be signed until later this fall, and she declined to disclose financial terms of the agreement or whether Pentair will hire new employees or build an additional facility in Saudi Arabia’s Eastern Province. The Golden Valley-based company currently has 14 locations—including manufacturing, sales, and operations facilities—in the Middle East.
 
Pentair—which manufactures valves, filtration and pump systems, water storage tanks, and other products for the energy industry—said it is interested in serving clients within the region’s energy and water sectors as well as offering desalination, agricultural, and oil and gas products and services.
 
“Pentair is excited by the opportunity to work with Ali Abdullah Al Tamimi Company in the largest energy market in the Middle East region,” Vice President and Managing Director for Pentair’s Middle East division Ramesh Nuggihalli said in a statement. “We are committed to local manufacturing in this region, which not only creates jobs and economic benefits, but offers greater efficiencies for customers and opportunities for collaboration.”
 
The Ali Abdullah Al Tamimi Company—whose main office is based in Dammam, Saudi Arabia—consists of more than 40 Saudi Arabian companies. The firm specializes in pipeline construction, commercial real estate, contracting, and power generation manufacturing, among other specialties. It employs approximately 16,000 at its regional offices.
 
In addition to maintaining operations in Golden Valley and the Middle East, Pentair has national offices in North Carolina, Wisconsin, and Texas, as well as international offices in Switzerland, Australia, and China. The company employs approximately 30,000 worldwide, 2,000 of whom work in Minnesota. The company reported 2012 revenue of $4.4 billion—a 27.8 percent increase over its revenue from the previous year.
 
Forbes magazine recently named Pentair to its list of “The World’s Most Innovative Companies” based on “innovative premium”—which was calculated by taking a company’s market capitalization and subtracting the net present value of cash flows from existing businesses.