Nestlé buys majority stake in Materna

Israel-based food company Osem, a subsidiary of Nestlé, has bought a majority stake of 51% in baby food manufacturer Materna. The two companies have signed a memorandum of understanding for US$61.8 million. Osem and Nesté will acquire the stake from Maabarot Products Ltd., which will retain 49% of Materna.

Osem, a maker of products ranging from snacks to instant soups, is 54%-owned by Nestle. Materna accounts for 55% of Maabarot’s activity and has the largest share of Israel's infant formula market. Materna and Osem had refrained from marketing Nestlé brand formula in Israel. Osem CEO, Gazi Kaplan, had previous said, however, that the company would enter the market, either through an acquisition or by launching a new product.

After the completion of the deal, Osem and Nestlé will have the option to acquire the remaining 49% stake in Materna within the next 15 years.

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