Nestlé sells ice cream business to Froneri for $4 billion
Nestlé has reached an agreement to sell its U.S. ice cream business to Froneri, an ice cream-focused joint venture Nestlé created in 2016 with PAI Partners, for a transaction value of $4 billion.
Nestlé has reached an agreement to sell its U.S. ice cream business to Froneri, an ice cream-focused joint venture Nestlé created in 2016 with PAI Partners, for a transaction value of $4 billion.
In 2016, Nestlé and PAI Partners merged Nestlé’s European ice cream business in 20 countries and PAI-owned R&R to create Froneri, one of the world’s largest ice cream companies. Froneri has been able to achieve rapid sales and profit growth, steadily gaining market share and reaching a turnover of around CHF 2.9 billion (approximately USD $3 billion) in 2018.
Froneri, which already had operations in Europe, Latin America, Africa, and Asia-Pacific will now have a strong presence in the United States, the largest ice cream market in the world. The recent acquisitions of TipTop in New Zealand and Nestlé’s ice cream business in Israel have also increased Froneri’s growing global footprint.
In 2018, Nestlé USA’s ice cream business had turnover of $1.8 billion. With brands like Häagen-Dazs, Drumstick, and Outshine, the business commands leadership in key ice cream categories, notably super premium.
“The creation of Froneri has been a phenomenal success. We are now making this business our global strategic partner in ice cream and are convinced that Froneri’s successful business model can be extended to the U.S. market. With this transaction, we are taking a decisive step towards our goal of achieving global leadership in ice cream,” said Mark Schneider, Nestlé CEO.
The transaction is expected to close in the first quarter of 2020, following the completion of customary regulatory approvals. Nestlé will continue to manage its remaining ice cream businesses in Canada, Latin America, and Asia as part of its current market structure.
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