Tnuva
Encyclopedia
Cooperative
A cooperative is a business organization owned and operated by a group of individuals for their mutual benefit...
(co-op) in Israel
Israel
The State of Israel is a parliamentary republic located in the Middle East, along the eastern shore of the Mediterranean Sea...
specializing in milk
Milk
Milk is a white liquid produced by the mammary glands of mammals. It is the primary source of nutrition for young mammals before they are able to digest other types of food. Early-lactation milk contains colostrum, which carries the mother's antibodies to the baby and can reduce the risk of many...
and dairy product
Dairy product
Dairy products are generally defined as foods produced from cow's or domestic buffalo's milk. They are usually high-energy-yielding food products. A production plant for such processing is called a dairy or a dairy factory. Raw milk for processing comes mainly from cows, and, to a lesser extent,...
s. The 620 members of the cooperative are made up a large number of kibbutz
Kibbutz
A kibbutz is a collective community in Israel that was traditionally based on agriculture. Today, farming has been partly supplanted by other economic branches, including industrial plants and high-tech enterprises. Kibbutzim began as utopian communities, a combination of socialism and Zionism...
im (or collective farms) and moshav
Moshav
Moshav is a type of Israeli town or settlement, in particular a type of cooperative agricultural community of individual farms pioneered by the Labour Zionists during the second aliyah...
im (or agricultural communities) in Israel. Tnuva is the largest dairy products manufacturer in Israel; its sales account for 70% of the country's dairy market as well as sales of meat, eggs and packaged food.
Tnuva Central Cooperative for the Marketing of Agricultural Produce in Israel Ltd. was created in 1926, following a decision by kibbutz
Kibbutz
A kibbutz is a collective community in Israel that was traditionally based on agriculture. Today, farming has been partly supplanted by other economic branches, including industrial plants and high-tech enterprises. Kibbutzim began as utopian communities, a combination of socialism and Zionism...
-movement leaders to make cooperatives to distribute and export several types of food products. Tnuva was created as a result but at first only delivered regular milk for drinking. It expanded to cover other dairy products in the 1930s.
Tnuva was labeled by the Israel AntiTrust Authority as a monopoly
Monopolization
The term monopolization refers to an offense under Section 2 of the American Sherman Antitrust Act, passed in 1890. Section 2 states that any person "who shall monopolize . ....
http://www.nfc.co.il/archive/001-D-47094-00.html?tag=7-43-05, a status that essentially places the company under government regulation limiting the way it can change the price of its products to protect the consumer and smaller competitors.
In 2006, it was reported that the Markstone Capital Partners Fund was interested in purchasing Tnuva and its assets for about $750 million. The general manager
General manager
General manager is a descriptive term for certain executives in a business operation. It is also a formal title held by some business executives, most commonly in the hospitality industry.-Generic usage:...
, Arik Reichman, values the company between $800 million to $1 billion.http://www.globes.co.il/serveen/globes/docview.asp?did=1000135652&fid=942 Another obstacle to selling the company or even a large minority share was the need to convert the cooperative to a company requiring a majority of the members approval.
On November 20, 2006 Apax Partners
Apax Partners
Apax Partners LLP is a global private equity and venture capital firm, headquartered in London. The company also operates out of eight other offices in New York, Hong Kong, Mumbai, Tel-Aviv, Madrid, Stockholm, Milan and Munich. The firm, including its various predecessors, have raised...
Worldwide LLP, a London-based buyout firm, won a tender to buy control of Tnuva. The bid values the privately held food and dairy group at $1.025 billion, larger than Strauss-Elite Ltd. and Osem Investments Ltd. the two largest publicly held Israeli food companies.
As of June 2011 Israeli consumer action groups are calling for a customer ban on Tnuva products.