Tnuva closes the Olivia spreads factory: what will happen to the brand?
The company has decided to close the production line at the Olivia factory in Rehovot and will import products from abroad under the brand. In recent years, Olivia has faced growing competition, led by the "Al HaLechem" brand.
Tnuva is closing the production line of the Olivia factory, a veteran spreads manufacturer specializing in products such as olive tapenade and sun-dried tomato pesto. Moving forward, the company will import similar products from abroad under the brand name.
The factory, located on the premises of the Tnuva dairy in Rehovot and employing 20 workers, will cease production in Israel, while the company will retain the brand itself. Olivia was founded in 1990 by private entrepreneur Yoel Banash and was a pioneer in the Israeli spreads market. In 1996, it was acquired by the holding company Kardan, and in 2002, it passed into the ownership of Tnuva as part of a series of acquisitions intended to expand the company's activity in the food sector. At the time, Arik Reichman, then CEO of Tnuva, stated that the spreads category constituted a strategic development channel with added value, aligning with Tnuva's intention to enter the gourmet field. In 2005, the factory moved from Even Yehuda to the Tnuva dairy complex in Rehovot.
The spreads category is defined as a niche segment, and the factory generates a turnover of only a few tens of millions of shekels per year. In recent years, Olivia has faced growing competition, including the company "Al HaLechem," which broke into the market with similar products. Nevertheless, the Olivia brand remains strong and has high consumer awareness, partly thanks to its status as a category pioneer and its associated image of quality. According to estimates, importing the spreads may be more cost-effective than local production. Olivia's operations are minor relative to Tnuva's total sales volume of approximately 8 billion shekels per year, the lion's share of which comes from dairy activities. Against this background, Tnuva management decided to discontinue local production. Factory employees will be offered alternative positions at other Tnuva facilities.
The closure of the Olivia production line follows a series of efficiency measures carried out by Tnuva in recent years, as the company divests from non-core activities. Previous moves include the withdrawal from poultry operations and the partnership in the A.A.T. broiler breeding company, as well as the closure of a joint venture for vegetable and food deliveries. These steps reflect a trend of increasing focus on the company's core business.
