January 11, 2010

Kehe-Tree of Life Merger Will Not Have Immediate Impact on Kosher, Sources Say

Chicago…Speculation was rife that the merger of two giant food distributors might impact the distribution of kosher foods, but sources close to both distributors indicate that it would not have any immediate impact for the upcoming Passover season. Kehe Foods has acquired Tree of Life, owned by the Wessanen, which has made the move to support growth of its European businesses. The transaction is expected to close in the first quarter of 2010. The purchase price was $190 million. Both Kehe and Tree of Life expanded their distribution of kosher foods in the ‘90’s as the industry was undergoing its major growth spurt. They took advantage of the growing involvement by supermarkets in kosher and followed the demise of several small kosher specialty distributors. It was also a period when several kosher food manufacturers and distributors joined the distribution fray, but Kehe and Tree of Life moved with the growing tide of mainstreaming kosher foods namely in the nation’s large supermarkets. Founded in 1952, Kehe supplies organic, natural, ethnic, kosher and other specialty food products. Tree of Life was founded in the early 1970's with a retail store in St. Augustine, Florida. Sources close to both distributors say that it will probably be a year before any major consolidation takes place.