Nestlé pushes ahead with €5bn Perrier and San Pellegrino deal
CD&R, KKR and PAI among firms through to next round in sale of 50% stake in water division
Nestlé’s sale of a multibillion euro stake in its water business has progressed, with a handful of private equity firms through to the next stage of bidding, according to people familiar with the matter.
The investment groups CD&R, KKR and PAI are through to the next round in a deal for a 50 per cent stake in the unit that could value the entire business at roughly €5bn, according to people familiar with the matter. Platinum Equity has also shown interest in the deal.
Nestlé has been working with investment bankers to explore a stake sale in its European water business, which includes brands such as San Pellegrino, Perrier and Acqua Panna. Initial bids were due earlier this month.
Its pursuit of a deal comes as the Swiss group undertakes a strategic overhaul led by new chief executive Philipp Navratil, who is seeking to turn around the struggling consumer goods group.
He has reorganised Nestlé to focus on four new categories: coffee, petcare, nutrition, and food and snacks. It has turned to private equity groups for other asset sales, including offloading the rest of its ice cream assets to joint venture partner Froneri that Nestlé jointly owns with PAI.
Since his appointment in September, Navratil has announced 16,000 job cuts over the next 18 months. He is also pressing ahead with plans to sell its vitamins and supplement brands.
Nestlé is not the only consumer group seeking to shed slower growing brands.
Unilever is also in discussions to sell its food division to spice and sauce maker McCormick, in a megadeal that would complete the consumer goods giant’s near decade-long pivot to faster growing beauty and personal care brands.
In 2021, Nestlé agreed a $4bn deal with US private equity firm One Rock Capital to sell its North American water business, which included the Poland Spring and Pure Life brands.
Nestlé, CD&R, KKR and PAI declined to comment. Platinum did not immediately respond to a request for comment.