Eshbal Functional Food Inc., a developer of gluten-free and health-focused food products, is pleased to announce key developments supporting its North American expansion strategy: the planned commercial launch of its U.S. produced gluten-free pita bread and the asset acquisition of Swonder Bread, an Israeli-based bakery specializing in sprouted gluten-free sourdough products. 

Eshbal is preparing to locally manufacture its gluten-free Pita Bread in the North American market. The upcoming launch marks the first time the Pita Bread will be manufactured and distributed locally in the United States.

For more than a decade, the Pita Bread has been produced and exported from Israel to a California-based restaurant group, which has provided consistent and positive feedback. Eshbal views this long-standing relationship as a strong indicator of product-market fit and future commercial potential.

The initial rollout of U.S. manufactured Pita Bread will be in frozen format to meet distributor requirements and ensure product integrity.

On June 15, Eshbal completed the acquisition of the operations of Swonder Bread, an Israeli bakery specializing in sprouted-grain sourdough and vegan breads. The acquisition includes all core assets — including proprietary recipes, trademarks, client base, production equipment, and inventory.

Swonder's products are gluten-free, plant-based, and free from artificial additives. They are produced using a natural fermentation process combined with sprouted grains—a method known to enhance digestibility and nutritional value. These capabilities expand Eshbal's position in the clean-label and gut-health product space. 

As consideration, Eshbal will pay approximately CAD $150,000 over three years for the acquired assets based on a Swonder product's revenue performance formula. The transaction is not considered material to Eshbal in terms of size, cost, or operational impact. It is an arm's length transaction, and no finder's fees were paid. To support a smooth transition, the founder of Swonder has agreed to sign a consulting agreement with Eshbal, which has a 36-month term, providing expert guidance on sourdough production, process integration, client onboarding, and marketing. The consulting agreement was signed on June 15th.

Eshbal believes that Swonder's product line can be scaled with relative ease in the Israeli market given existing infrastructure and brand awareness. More importantly, the acquired IP and formulations are expected to serve as a foundation for potential future offerings in North America.

"From day one, M&A has been a key part of our strategy—and this transaction represents one of the many steps we intend to take," said Tomer Bar Meir, CEO of Eshbal. "Swonder Bread brings unique and hard-to-develop know-how that fits perfectly with our long-term goals. We see immediate opportunities to grow this business in Israel, and we believe the underlying technology offers exciting potential for future product development in North America as well"

About Eshbal Functional Food
Eshbal Functional Food Inc. is a developer and manufacturer of health-focused food and nutraceutical products. With extensive experience in food innovation, the company leverages proprietary R&D and specialized production technologies to deliver Gluten-Free, Vegan, Low-Carb, Sugar-Free, and supplement-based solutions across a range of categories — from baked goods and spreads to protein blends, cereals, and dietary supplements. Eshbal caters to a diverse mix of industrial, foodservice, and retail clients in Israel and abroad, and is now actively scaling its presence across the North American market. This expansion follows the successful completion of a reverse takeover (RTO) with Hakken Capital Corp., through which Eshbal became a publicly listed company on the TSX Venture Exchange as of April 14, 2025. Eshbal is committed to making a meaningful impact on personal wellness — offering better choices for those seeking nutritious, innovative, and accessible food solutions. The Company's mission is to help people lead healthier lives by rethinking everyday food through science, purpose, and passion.