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Tnuva doubles its percentage of protein substitutes before going public

The Israeli food company Tnuva has signed an agreement with the stem cell company Pluristem to set up a joint venture for the manufacture of cultured protein-based products. After developing a suitable technology platform, the joint company will be producing cultured meat products as early as next year, with options to expand to cultured milk and fish meat. Tnuva chairman Haim Gavrieli told Calcalist that the deal will help boost the IPO of Israel’s largest food company.

The joint venture between Tnuva and Pluristem will initially develop a line of cultured meat products. Under the agreement, Tnuva will invest $ 7.5 million in the combined company based on a pre-valuation of $ 40 million with an option for an additional $ 7.5 million. Pluristem will provide the technological aspects for the cultivation of cultured cells, while Tnuva will take over the research and development for the end products and later the sales and marketing in Israel and abroad. It is estimated that the first cultured meat product could hit the market by 2023.
Tnuva chairman Haim Gavrieli. Photo: Rami Zerenger, Eran Yoffi Cohen

This move is nothing short of a change in Tnuva’s DNA, as the company’s core market has depended on agricultural products such as dairy, meat, poultry and fish for decades. It was only in the last few years that Tnuva began to adapt to current consumption trends. In addition, regulatory overhauls such as opening the market to meat and milk imports have threatened the company’s control of the market and required a reassessment of its direction.

Tnuva recognized the potential of the protein substitute market early on and invested millions of shekels in the development of milk substitute products under the brand name “Alternative” as early as 2017. “Going forward, we looked for protein substitute companies and decided to invest in Remilk,” said Gavrieli. “At the same time, we built a food tech incubator in the north of the country that is also researching protein substitutes, all with the intention of becoming a food substitute manufacturer not only in Israel but also abroad.”

Tnuva participated in Remilk’s second funding round last week. The cultured milk company raised $ 120 million, based on a pre-money valuation of $ 325 million – 10 times its value a year ago. Remilk developed a method of making milk proteins, identical to animal milk, using microbial fermentation technology that preserves the taste, texture and nutritional values ​​of dairy products.

As reported by Calcalist, Tnuva is preparing to go public this summer with an estimated value of NIS 8-10 billion. The company hired the law firm Meitar to prepare the prospectus based on the 2021 financial data. “We have received good indications from foreign banks that there is an interest in foreign markets to issue Tnuva shares in the IPO,” said Gavrieli.

Pluristem is a cell healing biotech company developing cell-based medicine based on a unique patented technology for cell cultivation in a 3D environment. The joint venture with Tnuva will build on Pluristem’s technology and adapt it to the cultured food sector. The technology could support the development and production of a wide variety of cultivated foods, including beef, poultry, fish, and dairy products.

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