Financial investors gain access to Nestlé's Skin division for $ 10 billion

Zurich / Frankfurt – Financial investors are also interested in anti-wrinkle remedies: a consortium led by Swedish investor EQT and a sovereign fund of Abu Dhabi (ADIA) invests about 10 billion francs in the healthcare sector Nestlé skin.

The bidders want to take over the division of skin care products, remedies for acne and hyaluron injections, by the end of the year. Thus, one of the largest acquisitions of financial investors in Europe since the financial crisis touches on his right. Nestle had put the division at stake last fall. The food company wants to focus more on its core business and develop it.

The region with the well-known brand Galderma and an annual turnover of 2.8 billion francs is specific to the new CEO, Mark Schneider: she is no longer in the picture: she is specialized in beauty products such as than hyaluron syringes against wrinkles and acne remedies, nail fungus and face fungus. about half of its sales in North America. Nestlé had previously run the business with its partner L & # 39; Oreal and had acquired its 50% stake about five years ago. But the new girl did not grow up as fast as expected and became a problem child. Schneider took the red pencil, scraped hundreds of jobs and written off shares to get the company back on track: in the first quarter, the region recorded double-digit growth.

The new owners now want to grow their business: "We have a lot of great ideas on how we make Nestlé Skin Health a pearl and on our income," said Marcus Brennecke, EQT's partner, the company's marketing agency. Reuters news agency. Among other things, there is potential for prescription products, some of which could become blockbusters. This means that funds in the pharmaceutical industry have an annual business turnover greater than one billion dollars. The consortium does not foresee a split of the division, on which some experts had made assumptions. "Our plans are based on the entire business," Brennecke said.


The interest of potential buyers was great: besides EQT and Adia, insiders, among others, a consortium of financial investors Advent, Cinven and KKR also launched their hat. Apparently, that is what drove the price: many analysts were expecting a turnover of between seven and ten billion francs. The experts from the Zurich cantonal bank spoke of a "very attractive sales price". In the stock market, Nestlé shares rose by 0.8% to reach a record of CHF 99.50. According to Refinitiv data, it is the second largest acquisition by financial investors in Europe since the financial crisis, after the sale of Akzo Nobel's specialty chemicals business to Financial investors announced last year.

What the Swiss company does with the proceeds of the sale remained open. Nestlé wishes to inform about the agreement in the second half of the year. The current stock repurchase program of 20 billion francs continues until the end of the year.

The sale of the division is Schneider Schneider's largest transaction ever since being named CEO of Nestle in early 2017. The former boss of the German health company Fresenius has ordered the world's leading market to reconvert: it sells declining areas and creates future careers – coffee, baby food, pet food or the healthy food sector. To that end, he bought the $ 2.3 billion Atrium vitamin manufacturer in Canada and negotiated a $ 7 billion license agreement with the American Starbucks brand.

All this should enable Nestlé to regain a growth rate of about 5% by next year. Switzerland did not survive: growth in the first quarter was 3.4%. For Schneider, however, the conversion on the sale of the division is not yet complete: there is currently a sales process for the Herta brand meat products business.