French dairy giant Danone has agreed a collaboration agreement with Else Nutrition, a supplier of plant-based infant-formula products in Canada.
Vancouver-headquartered Else said in a statement that the two companies had signed a letter of intent providing for a “multi-stage collaboration, subject to the finalisation of certain commercial terms”, following Danone having completed extensive due diligence.
The Canadian company added the first stage of the project will see the businesses enter into a license agreement whereby Else’s products will be included in Danone’s specialised nutrition portfolio and manufactured, marketed and commercialised by the French dairy major.
When questioned by Just Food, an Else spokesperson said: “Danone will produce the products it will commercialise in Europe initially but there is potential for expansion into other markets.”
Else, founded in Israel in 2018 by veterans of the infant-formula industry, entered the European market this month with a UK launch. CEO Hamutal Yitzhak said “the UK represents our first entry into the lucrative European market and we expect to enter additional European countries in the near term”.
He added: “Moreover, Europe is an ideal market for our products given consumer preferences and trends towards healthy and nutritious plant-based options, especially for their children.”
Access the most comprehensive Company Profiles
on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Company Profile – free
sample
Your download email will arrive shortly
We are confident about the
unique
quality of our Company Profiles. However, we want you to make the most
beneficial
decision for your business, so we offer a free sample that you can download by
submitting the below form
By GlobalData
Else said that after the first stage of the project, the two companies will “negotiate other opportunities beyond product commercialisation”.
The spokesperson said this means “other business or scientific mutual activities besides licensing the toddler product in Europe”.
The company stressed this “is not an acquisition of Else at this point”, adding “it’s a collaboration agreement for the Europe market, with an agreement to discuss other activities and geographies that may be negotiated in the future”.
Else, which uses a co-manufacturer, said the deal does not at present impact its business in North America or other countries outside of Europe.
It said the parties anticipate signing the definitive agreement by the end of Q1, 2024.
Danone, which owns plant-based alt-dairy brands including Alpro and Silk, has increased its exposure to the category in recent years through acquisitions and investment.
In 2021, it acquired US plant-based products provider Earth Island, which specialises in faux-cheese and mayonnaise.
And in April this year it invested in Israel-based animal-free dairy start-up Imagindairy.
Danone declined to comment on the collaboration agreement with Else when contacted by Just Food.
