Israel’s Eshbal Functional Foods has successfully acquired the assets of US-based Gluten Free Nation after a previous deal fell through last year. This acquisition aligns with Eshbal’s strategic goal to expand its footprint in the US market, following the acquisition of Swonder Bread.
In June, Eshbal signed a letter of intent to purchase Texas-based Gluten Free Nation, which also operates under the name Starcall Broadcasting. However, the initial transaction was pulled in August, with Eshbal stating that it “did not mature to a final agreement.”
Eshbal CEO Tomer Bar Meir clarified that there were “issues” during the original negotiations but declined to provide specific details. “We decided to shift from an acquisition to an asset purchase,” he explained. The finalized deal now encompasses recipes, customers, and suppliers, effectively everything except the registration name.
It is important to note that the acquisition does not include any factories, as Gluten Free Nation has collaborated with two manufacturing partners that will remain in place after the deal. The newly acquired business will operate under Eshbal’s subsidiary, Eshbal USA.
Founded by Randi Markowitz, Gluten Free Nation specializes in gluten-free sweet and savory bakery products, including cookies, cakes, and buns. These items are distributed across both retail and foodservice channels, reflecting key trends in the food and beverage industry.
Eshbal, publicly listed in Toronto, announced on February 6 that the new acquisition was formalized through a “bill of sale and assignment agreement” with Starcall and its own US subsidiary. The transaction price is set at $736,425, comprising $236,425 in cash and the remainder in new Eshbal shares. This deal is pending clearance from the TSX Venture Exchange in Canada.
In parallel, Eshbal recently revealed a manufacturing partnership with Canadian company Queen St Gluten Free, aimed at producing gluten-free products for the North American market. This partnership will initially feature Eshbal’s gluten-free pita bread, with plans to expand to additional products in the future.
Eshbal prides itself on using natural ingredients such as teff and chia to create gluten-free bakery products. Their offerings also include vegan, low-carb, and sugar-free snacks alongside dietary supplements. Eshbal owns the Barili brand, which includes pita breads, buns, and cookies, in addition to its Caragil line of flours and cake mixes.
In July, Eshbal acquired a majority stake in the US-based producer Dare to Be Different Foods (D2BD), which specializes in low-carb and gluten-free options. Last year, Eshbal also collaborated with Florida’s Active Marketing Group to provide comprehensive sales and marketing support across their combined product portfolio.
This strategic move highlights Eshbal’s commitment to responding to evolving food and drink consumer trends, ensuring they remain competitive in the dynamic food and drink business landscape.
