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The Strauss Group is in advanced negotiations to acquire the Tami 4 water purification company for $90 million. The final price will depend on the third-quarter performance of Tami 4.

If the deal goes through, it could well set a record for a kibbutz-owned business.

The next step for Strauss would be to merge Tami 4 with H2Q Water Industries, which the food giant purchased about two years ago.

Tami 4 is controlled by FIMI Opportunity Funds, a mezzanine and buyout fund that is owned by Ishay Davidi (41%), Kibbutz Netiv Halemed-Heh (32%) and other investors.

Tami 4 manufactures water filters, purifiers and coolers, marketing its products in Israel and abroad. Annual sales have risen steadily and currently stand at about NIS 300 million.

The company broke into foreign markets a few years ago and has considerable future sales potential abroad, in part because water treatment systems are viewed as better for the environment than the main alternative - shipping mineral or filtered water in disposable plastic bottles. Tami 4's brightly colored, attractively designed units for household use have helped give it an edge over the competition.

The entry of Strauss into the home and office market for drinking water is expected to be a good match for its forays into the office coffee machine sector abroad.