Nestle to Buy Goldfrost?
Written by: Aaron Katsman | June 6, 2007
By Aaron Katsman
www.IsraelNewsletter.com
Is Nestle trying to expand even more into the Kosher food business? Already owning a controlling interest in the Israeli food giant Osem (OSEM.TA), today the Times Online reports, that Goldfrost, a subsidiary of G. Willi Food-International Ltd. (WILC), may be a target of the largest food and beverage company in the world. 76% of Goldfrost is still controlled by G.Willi Food. Goldfrost, which IPO’d in March ’06 on the AIM market, posted revenue of $3.75 million in the 1st quarter. Nestle’s purported move highlights what I posted about the explosive growth of the Kosher food market. This validates G.Willi Food’s plan of aggressively entering the US market with their wide array of Kosher food products. Aside from the quick few million dollars they would pocket resulting from such a sale of the Goldfrost subsidiary, I believe this could help forge some kind of relationship with the parent company as well, which would be a big and unexpected benefit to G. Willi Food.
Already an attractive investment opportunity based on financials… PE under 11 which is more than half the industry norm, revenue increasing by over 25%, and strong gross margins… G. Willi Food continues to be an intriguing investment for years to come.
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Disclosure: Author’s fund is long WILC as of 6/06/07.
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Aaron Katsman is the lead portfolio manager for the Israel Growth Portfolio and Managing Director of America Israel Investment Associates, LLC. For more information, go to www.israelnewsletter.com or call 1-888-327-6179, or email aaron@profile-financial.com.
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