Tnuva Shuts Down Olivia Spread Factory After Decades as Israeli Market Pioneer

Tnuva has decided to close the Olivia factory, a longstanding brand known for pioneering spreads like tapenades and pestos in Israel since the 1990s. The factory, located within Tnuva's facility in Rehovot and employing about 20 workers, will cease local production within approximately two months. All employees will be offered alternative roles within Tnuva, with no layoffs expected. Although the Olivia logo remains owned by Tnuva, local manufacturing will stop, and existing inventory will keep products on shelves for several more months.

Olivia was founded in 1990 by entrepreneur Yoel Banash and became a category leader in spreads. It was acquired by Kardan Holdings in 1996 and then by Tnuva in 2002, with the factory moving from Even Yehuda to Rehovot in 2005. Despite brand recognition, Olivia's annual sales were estimated at around 15 million shekels, within a roughly 50 million shekel spreads market that has seen little growth and increased competition from brands like "Al HaLechem," Neto's Fresco, and ethnic spread specialists Biton and Zahavi.

Tnuva cited the small scale of the operation and the need for costly production line upgrades as reasons for the closure, which does not justify the investment given the minimal profit contribution compared to Tnuva's overall annual turnover of about 8 billion shekels, mostly from dairy products. The Olivia brand may return via imports or be repurposed for other food products.

This closure is part of Tnuva's broader streamlining efforts ahead of a planned stock market listing. In recent years, Tnuva exited poultry farming and slaughtering in 2020 and ended egg marketing and distribution in 2024 after nearly a century, due to price controls and private-label competition. Concurrently, Tnuva has invested heavily in new categories, including hundreds of millions of shekels in the Soy Magic plant for dairy alternatives under the Alternative brand.