Willi-Food in pact to form global kosher trade company
February 13, 2007
by Eric Schroeder
YAVNE, ISRAEL — G. Willi-Food International Ltd., one of Israel’s largest food importers, signed an agreement with the Baron family to form a joint global kosher trade and export company. Located in Israel, the Baron family exports kosher food products such as candies, preserves, cakes and cookies, snacks, cereals, frozen pastries and ice creams, baby food and general grocery items.
Under terms of the agreement, Willi-Food will hold a 50.1% interest in the venture, with the Baron family holding the remaining interest. In addition, all of the current food export operations of the Baron family will be executed under the new entity.
Willi-Food said the new company will have trade volume of approximately $10 million. In consideration for the 50.1% interest, Willi-Food will pay up to $2 million in trade financing, as needed. Of this amount, an amount equal to two times net profit before tax during the first four full consecutive quarters (after closing) will be converted into equity, up to a maximum amount of $1 million, Willi-Food said.
The closing of the transaction is subject to customary closing conditions, including approval of the Israeli Anti-Trust Authorities and completion of exhibits.
"We are very excited about this opportunity," said Zwi Williger, president and chief operating officer of Willi-Food. "The transaction will significantly expand our geographic reach through the addition of several export markets as well as increase our penetration into the U.S. market and complement our recent acquisition of Laish. We will also benefit from a wider overall product offering and new supplier relationships."
In late January, Willi-Food paid $3.7 million for Laish Israeli Food Products Ltd., a U.S. importer and distributor of kosher food products.