Nestlé sells half of water business to Platinum Equity

VEVEY, Switzerland — Nestlé has agreed to sell a 50% stake in its Waters and Beverages business to the private equity firm Platinum Equity for €3 billion, or about $3.4 billion, in cash.

The companies will operate the business through a new joint venture, Peranel. The venture is valued at €4.9 billion, or approximately $5.6 billion, including cash and debt.

The transaction is expected to close in the first half of 2027, subject to regulatory approvals and other customary closing conditions.

Nestlé’s water business includes the premium brands Perrier and S.Pellegrino. The transaction is part of the Swiss consumer goods company’s broader effort to simplify its portfolio and focus resources on businesses with stronger growth and returns.

The deal follows a review of the Waters and Premium Beverages business and marks another step in Nestlé’s restructuring under CEO Philipp Navratil. Since taking the position in September, Navratil has focused on reducing costs, streamlining the company’s portfolio, and reorganizing operations around four principal categories: coffee, pet care, nutrition, and food.

Nestlé is also cutting approximately 16,000 jobs as part of the overhaul.

In February, the company announced plans to transfer its remaining ice cream operations to Froneri, the joint venture in which Nestlé retains a 50% stake. The company has also been evaluating options for several brands in its vitamins and supplements portfolio.

Nestlé said it expects to sell its mainstream and value-oriented vitamin brands in the first half of 2027. The company anticipates recording a loss of approximately 1.3 billion Swiss francs related to the disposal.

The restructuring expenses weighed on Nestlé’s first-half earnings. The company reported net profit of 3.47 billion Swiss francs, or approximately $4.26 billion, compared with analysts’ expectations of about 5.07 billion francs. Nestlé shares declined sharply following the results.

Despite the earnings pressure, organic sales increased 3.7% during the second quarter. Pricing contributed growth of 1.9%, while real internal growth, which reflects changes in sales volume, was 1.8%.

Second-quarter sales totaled 21.79 billion Swiss francs, up from 21.63 billion francs in the year-earlier period and slightly ahead of analysts’ expectations of 21.71 billion francs.

Nestlé’s portfolio changes reflect a broader push among major consumer goods companies to simplify their operations. Unilever separated its ice cream business into The Magnum Ice Cream Co. and agreed to combine its food operations with McCormick & Co. Associated British Foods has also announced plans to separate its Primark retail business from its food operations.