Tnuva Relocates Pasta Factory to Former Olivia Site

Tnuva is shifting its focus from spreads to pasta. As Calcalist has learned, the food conglomerate, which announced last week the closure of the "Olivia" spreads factory, will relocate the "Rico" pasta factory—in which it holds a 51% controlling stake—to the site of the spreads factory within the Rehovot dairy complex. The investment in the project is estimated at approximately 30 million shekels.

The move follows an eviction demand from property owners in Beit Dagan, where the pasta factory currently operates, aligning with Tnuva's strategic plan to exit the low-margin spreads business. The Olivia factory, expected to close within the next two months, is located at the Rehovot dairy complex, where Tnuva produces liquid milk and heavy cream. The relocation of the pasta production line is scheduled for the first quarter of next year.

Olivia was founded in 1990 by food engineer Yoel Banash. In 2000, Tnuva acquired a 50% stake from Kardan for 7 million shekels, alongside a 4 million shekel owner's loan. Tnuva later acquired the remaining stake, becoming the controlling shareholder. Tnuva's owner's loan to the company currently stands at 34 million shekels. Upon closure, Tnuva will be able to recognize this as a capital loss, which can be offset against the conglomerate's profits.

The relocation plan coincides with an ongoing dispute between Tnuva and the founders of the fresh pasta manufacturer, Doro Italian Products, in which Tnuva acquired a 51% stake in 2019 for approximately 21 million shekels. The conflict stems from a valuation disagreement regarding the option to purchase the remaining shares: the founders commissioned a valuation of 142 million shekels, while Tnuva’s BDO valuation placed the company at 79 million shekels.

The founders have filed four lawsuits against Tnuva, all of which have been rejected. These included demands to cancel board decisions regarding rent and distribution fees, as well as a bid to compel Tnuva to purchase their shares for 50 million shekels. Appeals are currently pending before the Supreme Court. Additionally, a labor court lawsuit filed by Shay Alon regarding his employment during reserve duty was dismissed, and a defamation lawsuit against company leadership remains ongoing.

The pasta company, founded 12 years ago, employs dozens of workers at its Beit Dagan plant. Its 2024 sales are estimated at 56 million shekels, yielding a profit of 12 million shekels. Current monthly sales volume is approximately 6 million shekels, reflecting an annual run rate of about 70 million shekels.