FDBusiness.com

PepsiCo and Strauss Group, Israel’s second-largest food and beverage company, are to form a joint venture partnership that will produce and sell fresh dips and spreads in key markets outside of North America. The two companies have operated a successful North American joint venture since 2007 under the Sabra brand. In North America, Sabra is the number one brand of hummus and the leader in the chilled dips and spreads category.

PepsiCo and Strauss will leverage their existing infrastructures and invest in manufacturing plants, technologies and employees to set up local operations on a country or regional level. Each partner will own 50% of the new joint venture business. Financial terms were not disclosed.

With nearly 50% category share in North America, Sabra’s products include hummus, fresh salsa and egg plant dips. Sabra’s 2010 revenues totaled $159m, up nearly 45% from the prior year.

The new joint venture follows recent efforts by both PepsiCo and Strauss to promote health and wellness throughout their product portfolios. In October 2010, PepsiCo formed its Global Nutrition Group to accelerate product development in the areas of fruits and vegetables, whole grains, dairy and functional nutrition. PepsiCo has set a goal of tripling its annual revenues from nutritious and functional foods from approximately $10b in 2010 to $30b by 2020.

Strauss Group operates 19 production sites in 20 countries. In the last seven years the group has consistently achieved growth, generating around $1.83b in turnover at the end of 2010, of which 46% came from international activities. Strauss Group comprises of four core business units: Strauss Israel, Strauss Coffee, Strauss North America and Strauss Water. The group is a leading player in coffee markets in Central and Eastern Europe, Brazil and Israel for Roast & Ground (R&G) coffee and other coffee related products and services.