Company diplomat Reported this morning that it acquired control (51%) of the frozen garlic and seasoning products manufacturer Dorothea, a cooperative agricultural association that until now was owned by Kibbutz Dorot in the Negev. The transaction, made for a total consideration of NIS 76 million, is subject to the receipt of approval from the Competition Authority.
The agreement includes provisions for the protection of the kibbutz, which will hold 49% of the shares, and will regulate, among other things, the change in the company’s legal and tax structure, the manner of appointing directors and the distribution of profits.
Dorot operates in the field of development, production, marketing and sale of frozen vegetable and seasoning products (mainly garlic) and is considered one of the leading players in its field in Israel. It operates mainly in the Israeli and American food markets, with 50% of its sales going to the local market. In the United States, Dorot products are sold at more than 6,000 points of sale in the Trader-Joe, Walmart and Target chains, and in a number of countries in Europe. The company’s revenues in 2021 amounted to NIS 72 million.
The deal will strengthen Dorot’s capabilities to continue to develop new products as well as expand its production capacity. Diplomat, which has a sales and distribution base in Israel that includes about 3,000 customers, will increase sales of the factory’s frozen products in the retail and institutional market both in Israel and abroad.
“We have begun to leverage the growth of the last 5 years”
Diplomat Holdings Engaged in the marketing, marketing and distribution of consumer products in Israel and abroad. For comparison, the Tel Aviv 125 index has fallen by 9% since the beginning of 2022. The company is controlled by chairman Jeffrey Mendel (holding about 24%) and CEO Noam Weiman (13%).
According to Uri Shemer, Chairman and CEO of Dorot Business: “After five years of significant growth in activity and profitability, Kibbutz Dorot has made a decision to leverage this growth and introduce a strategic partner that will help the company grow significantly. “About ten companies competed in the process, and after an inspection conducted with an investment banker, Diplomat Holdings was selected as the appropriate strategic partner.”
Diplomat divides its activities into five geographical areas – the main one of which is the local market, where it sells and distributes products to about 3,000 customers, including large and medium-sized food chains, pharma chains, mini markets, containers, restaurants, catering companies and wholesalers. Apart from Israel, it operates in South Africa, Georgia, New Zealand and Cyprus. The company markets over 100 international brands, including Procter & Gamble (Pampers, Ariel, Gillette), Tuna Starkist, Mondeliz (Milka Chocolate, Oreo, Tobelron), Beyond Meat, Heinz, Lotus, Kellogg’s, Red Bull, and most recently a brand The Italian super Chirio specializes in tomato products.