Nestle to be given more time by CADE to sell brand package - report (translated)
05 OCT 2017
Nestle [VTX: NESN] will be given more time by the Brazilian Competition Authority CADE to sell a brand package, O Estado de Sao Paulo reported, citing unnamed sources.
The sale was a condition imposed by CADE last year to clear Nestle’s 15-year-old merger with Brazil-based chocolate maker Garoto, the Portuguese-language item said.
Nestle had until the end of October to make the sale, but CADE is expected to postpone the deadline to 1H18 at the company’s request, the item stated.
The package comprises more than ten brands – including Serenata de Amor, Chokito, Lollo, and Sensacao – in addition to recipes and production secrets, the item stated.
If the sale fails to materialise, CADE’s understanding is that the Nestle/Garoto merger will have to be undone, according to the report.
Nestle cannot sell the brands to a large competitor, thus excluding Illinois-based Mondelez [NASDAQ:MDLZ] from the negotiations, the item added. The assets are likely to be acquired by smaller rivals, such as Argentina-based Arcor and Pennsylvania-based The Hershey Company [NYSE: HSY].
Nestle declined to comment on the O Estado report.