Eshbal Functional Food LTD, a long-standing food manufacturer and developer based in Kibbutz Ma'anit in northern Israel, has gone public on the Toronto Stock Exchange with a valuation of 17 million Canadian dollars, aiming to break into the American market with its line of gluten-free baked goods.
Eshbal (founded decades ago as Galaam Packaging) was first listed on the Canadian stock exchange through a merger with a local shell company at a valuation of 17 million Canadian dollars.
It is a long-established company founded by the kibbutz, which was acquired in 2014 by Yuval Levy and other investors.
Galaam was a well-known brand in Israel, under which basic products like cornstarch (famous for its packaging featuring a baby’s face), powdered sugar and other baking goods were produced and marketed on the kibbutz grounds.
Today, the company, now specializing in gluten-free baked goods, is planning to enter the U.S. market with a gluten-free pita to be manufactured in the United States.
After selling Galaam’s baking operations to Levy, Kibbutz Ma'anit made a “major exit” by selling Galaam’s parent company, which focuses on sugar substitutes, primarily for the global soft drink industry, to FIMI Opportunity Funds (a leading private equity firm in Israel) for 290 million shekels.
Levy, formerly Senior EVP at Frutarom, gained national attention after acquiring Remedia Industries Ltd. following the company’s collapse due to a high-profile infant formula scandal in the early 2000s.
Since taking over Eshbal, Levy introduced two growth engines: private-label nutritional supplements produced for well-known vitamin companies such as Altman, Mycolivia (medicinal mushrooms), and more, as well as gluten-free products.
Today, Eshbal is one of the two largest producers of gluten-free goods in Israel.
Eshbal continues to operate from Kibbutz Ma'anit, employing 70 workers. Its 2024 revenue reached 50 million shekels, and the company is profitable.
“We wanted to raise capital to enter the U.S. market, but we’re too small for a public offering in Israel,” he said.
“A Canadian company approached us, and we entered the market with a 12 million Canadian dollar valuation. We're now trading on the TSX Venture Exchange and raised 2 million Canadian dollars that were in the shell's account.
A second funding round is planned soon, targeting mergers and acquisitions in our sector across North America."
Levy added: “We plan to enter the U.S. gluten-free market by acquiring companies and producing our top-selling products locally.
"We'll launch with our flagship item, gluten-free pita. It’s a niche market, but we have no competitors in the American market. In Israel, our product range also includes breads, cookies, rolls and more."
The global gluten-free market totaled $8 billion in 2024, with the United States accounting for 40% of it.
The market is expected to grow to $14 billion, with an annual growth rate of 10%, which explains why it has attracted interest from Canadian investors.
“Despite the ongoing war and reluctance from some international companies to do business with Israel, and amid rising antisemitism in Canada, we successfully went public and raised funds in Canada,” Levy said. “Now we’re preparing for the next phase."