Nestlé is in exclusive talks with a consortium of buyers led by US private equity firm One Rock Capital to sell its North American water business, which includes the Poland Spring and Pure Life brands, for approximately $ 4 billion, people knowledgeable about the matter said.
The Swiss consumer goods giant has had talks with a number of buyers since June, including major European rivals, but the US private equity group, which works with other lenders, has presented the highest bid in the sales process, these people said.
We don’t know who One Rock works with. A person briefed on the negotiations said the US private equity group is likely to immediately sell some of the brands to other buyers.
A deal could be done within weeks, one person said, as the two sides finalized the deal. The division’s roughly $ 4 billion valuation also includes debt. The talks were first reported by Reuters.
Nestlé’s decision last year to review its US-based brands, which also include Deer Park, Ozarka, Ice Mountain, Zephyrhills and Arrowhead, came as bottled water sales plummeted during the coronavirus.
Plastic bottles faced an environment backlash, while Nestlé’s use of groundwater in some American communities has sparked protests. Its low-margin US brands have lost market share in the face of stiff price competition.
The Vevey-based company will continue to own its premium sparkling water brands, San Pellegrino, Perrier and Acqua Panna, including in the United States. He said last year that he was “fully committed” to developing them.
The sale will significantly reduce Nestlé’s presence in the bottled water market. The brands sold achieved a turnover of around 3.4 billion francs in 2019, or more than 40% of Nestlé’s overall 7.8 billion francs turnover from water this year- the.
Nestlé declined to comment, while One Rock did not respond to requests for comment.
It would be a major deal for New York-headquartered One Rock, which has around $ 3.2 billion in assets under management in three funds and typically buys mid-market companies, according to its website.
The private equity group was founded in 2010 and seeks companies with growth potential and opportunities for operational improvement, the site says. He bought Newell Brands’ process solutions business, which manufactures plastic, nylon and zinc products, for around $ 500 million in 2019.