Eshbal Launches North American Production with Queen Street Bakery Inc.

Executive Summary

• Eshbal Functional Food announced a partnership with Queen St Gluten Free Inc. to manufacture its gluten‑free pita bread and other products for the North American market, with commercial production slated for Q1 2026.
• The agreement is the third major North‑American transaction in six months, following the acquisition of Dare 2 Be Different Foods and a sales/marketing agreement with Active Marketing Group, underscoring Eshbal’s roll‑up strategy in the gluten‑free “Better for You” sector.
• Production will be localized in Canada using Eshbal‑supplied proprietary flour blend and equipment, providing cost and supply‑chain efficiencies for U.S. grocery distribution.

Key Details

• Partnership Scope: Queen St Bakery will produce Eshbal’s gluten‑free pita bread initially; additional Israeli product lines are expected to follow.
• Supply Arrangement: Eshbal will supply its proprietary flour blend from its own facility; all other ingredients will be sourced locally in Canada.
• Equipment Transfer: Proprietary production equipment has been installed at Queen St Bakery’s facility, and Eshbal’s R&D team is providing ongoing product‑specific know‑how.
• Commercial Launch Timeline: Subject to final packaging approvals, commercial production is planned for Q1 2026.
• Strategic Fit: The partnership leverages Canada’s favorable sourcing conditions (pulses, grains) and transportation backhaul capacity to serve U.S. Northeast retailers efficiently and extend reach as far as California.
• Roll‑Up Strategy Context: This is the third significant North American transaction in six months:
• November 2025 – acquisition of a majority stake in NYC‑based Dare 2 Be Different Foods, providing distribution in Walmart and 300+ U.S. stores.
• November 2025 – agreement with Florida‑based Active Marketing Group for nationwide sales and marketing support.
• Management Commentary:
• Tony Ayala, President of Queen St Bakery: “We’re excited to partner with Eshbal… we believe these products fill a significant gap in the market.”
• Avi Markus, Chief Commercial Officer, Eshbal North America: “This agreement represents a significant operational milestone… enables us to localize production, align shipment schedules and ensure first‑rate quality.”

Notable Quotes

• Tony Ayala (Queen St Bakery): “We’re excited to partner with Eshbal to support the local production of their gluten‑free Pita products. We believe these products fill a significant gap in the market.”
• Avi Markus (Eshbal): “This agreement represents a significant operational milestone for Eshbal as we continue to build our North American platform.”