ISRAEL: Elite and Kellogg mull JV

Elite, one of Israel's leading food manufacturers, and Kellogg, one of the world's largest manufacturers of cereals, are negotiating a possible strategic cooperation. Elite aims, according to trade sources in Tel Aviv, to distribute Kellogg's cereals in Israel. In recent years, consumption of cereals in Israel, whether imported or locally processed, has increased significantly, especially among children.Should Elite and Kellogg establish a form of cooperation, "Elite will in fact compete with its ice cream partner Unilever. Last month Unilever purchased the American company Bestfoods, which controls Israeli company Telma (Tami), currently the leading manufacturer of breakfast cereals in Israel. The value of the breakfast cereals market in Israel is estimated at US$70m. Kellogg's cereals, currently distributed in Israel exclusively by Alex Agencies, hold a 20% share of the market, which boasts annual growth of 12%.