Global food and beverages company Nestlé reached an agreement to sell its USA ice cream business to Froneri, for a transaction value of US$4 billion. Froneri is an ice cream-focused joint venture between Nestlé and PAI Partners. Froneri was formed in 2016 after PAI Partners merged with Nestlé’s European ice cream businesses in 20 countries.
With the acquisition of North America’s ice cream business Froneri has enhanced its global footprint. Recently the company has acquired TipTop in New Zealand and Nestlé’s ice cream business in Israel. The company had operations in Europe, Africa, Latin America, and Asia-Pacific, and now it expands to the world’s largest ice cream market USA.
Nestlé USA’s leading ice cream brands like Häagen-Dazs, Drumstick and Outshine are laders , command leadership in key ice cream categories, notably the super-premium segment. The transaction is expected to close in the first quarter of 2020, following the completion of customary regulatory approvals. After the USA deal, Nestlé will continue to manage its ice cream businesses in Canada, Latin America, and Asia.
Mark Schneider, Nestlé CEO, said: “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 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.”
Ibrahim Najafi, Froneri CEO, said: “This is another milestone acquisition for Froneri as we drive towards becoming the world’s best ice cream company. We’re delighted to be bringing such well-loved U.S. brands into the Froneri family. The acquisition is a testament to the strength and longevity of our relationship with Nestlé. This partnership and the continued support of PAI Partners will be essential to ensuring we continue to delight consumers with innovative, high-quality products in all markets.”
Nestlé is the worlds largest, most diversified food and beverages company. Established over 150 years ago, Nestlé employs more than 300,000 worldwide. Nestlé is dedicated to advancing nutrition, health, and wellness in a way that is sustainable and responsible and the company is a leader in many of the fastest growing food and beverages categories.
Food and beverages are core to Nestlé and they aim to capture premiumization opportunities and, at the other end of the spectrum, offer affordable, high-quality nutrition. Nestlé is also well-positioned to build and share nutrition knowledge from birth to healthy aging, and benefit from increased interest in nutrition to support good health.
Nestlé has a global footprint with products sold in 190 countries. Nestlé focuses on expanding its presence in high-growth regions. Emerging markets represent more than 40% of sales. In most of the emerging markets, Nestlé has been present for many decades and our brands enjoy a high level of trust and are rightly viewed as local. Nestlé currently has more than 400 factories in 85 countries.
Rapid innovation and bringing products to market faster are key dimensions of their growth agenda. Nestlé follows a disciplined policy towards acquisitions and undertakes acquisitions that come with high growth potential, deliver attractive returns and build on the companys leadership positions.
Acquisitions have helped gain access to new technologies, brands, categories and geographies. Additionally, small to medium-sized acquisitions have offered a fast and cost-effective way to embrace new capabilities or business models. They are also actively divesting businesses that are non-core.
Froneri is a fast-growth international business with a vision to build the worlds best ice cream company. Created in 2016 as a joint-venture between PAI Partners and Nestlé, Froneri is the second largest manufacturer of ice cream in Europe, the third largest worldwide and the number one private label producer worldwide. Froneri is present in more than 20 countries with revenues of USD 2.9 bn in 2018 and employs more than 10,000 employees worldwide.