Else Nutrition, a start-up developing plant-based nutrition products including baby powders, has signed a five-year production deal with an unnamed infant-formula manufacturer in the US.
The company, founded in Israel in 2018, said in a statement it had inked a memorandum of understanding with a “leading US-based organic baby-formula producer” as its manufacturing partner ahead of the planned launch of its first products in the second quarter. Those will consist of dairy and soy-free infant formula and children’s nutritional drinks.
Go deeper with GlobalData
Else Nutrition was co-founded by Hamutal Yitzhak, who is chief executive, Uriel Kesler, its chief operating officer, and Michael Azar, the head of technology. According to a company spokesperson, the founders are Israel-based veterans of the infant-formula industry having worked for firms such as Nestle, Abbott and Titans.
While the business was formed in 2018 in Israel, product development started around 2013, the spokesperson told just-food, adding that the idea to set up a dairy-free nutrition business originated when one of the founder’s children developed an allergy to milk.
The company envisages “great demand” for its products based on research carried out in the US, the spokesperson said, noting the three main ingredients in its products are almonds, buckwheat and tapioca.
Else Nutrition was originally fully-owned and funded by the founders until June last year, but since it listed on the TSX Venture Exchange in Canada via a private placement they now hold more than 50% of the business, which is part of the Canadian parent company Else Nutrition Holdings located in Vancouver, the spokesperson confirmed.
Initial production will be carried out at “a new state-of-the-art infant-nutrition facility” in the US with an investment of US$500,000 planned for “a dedicated packaging and manufacturing line”, according to the statement. Asked to clarify if Else Nutrition is investing in a brand new plant, the spokesperson said the funds are only for the addition of equipment for the packaging line within the site’s existing baby-formula production.
“Else Nutrition and the manufacturing partner expect to complete and sign a definitive production agreement” in the first three months of 2020, the statement read. However, the spokesperson would not disclose the location of the US plant until an agreement has been reached. There is also no connection between the Canadian holding company and the owner of the US facility, the spokesperson confirmed.
CEO Yitzhak added in the statement: “After a rigorous selection process, we are delighted to enter into this production MOU as it will allow us to ensure the highest quality and purity standards for Else formula. This world-class facility provides for hands-on monitoring of each batch, ensuring increased testing accuracy and the highest quality in finished products.
“Producing in a facility dedicated to making baby formula has far-reaching implications for quality and cleanliness. Having such high-calibre long-term production in the US ensures we can efficiently meet future demand in this key global market while adhering to our strict quality standards.”
The debut products will be rolled out online in the US and Canada, with plans to launch in “select” markets in Western Europe and South-east Asia “at a later stage”, the spokesperson said, adding that the composition of Else Nutrition products “meets the strictest regulatory standards for baby nutrition”.
