Nestlé sells half of its water business for $3.4 billion, forming joint venture Peranel
Nestlé announced the sale of half of its water business to Platinum Equity for $3.4 billion, forming joint venture Peranel. Peranel will encompass more than 30 brands including S.Pellegrino, Perrier, and Essentia, with headquarters in Paris, and the transaction is expected to be completed in the first half of 2027. This move is the latest step by Nestlé CEO Philipp Navratil to streamline its portfolio.
At a Glance
- Nestlé has sold half of its water business to private equity firm Platinum Equity for $3.4 billion, with the two parties forming a new premium beverage company called Peranel.
- Peranel is a joint venture equally owned by Nestlé and Platinum Equity, encompassing more than 30 brands including S.Pellegrino, Source Perrier, Essentia, Nestlé Pure Life, and other local water brands.
- Nestlé said in a statement that the transaction will make Peranel a fully independent company headquartered in Paris, with "full flexibility to invest in brands and pursue growth opportunities."
In-Depth Analysis
The sale is the latest move in Nestlé CEO Philipp Navratil's active review of the food giant's portfolio, aimed at divesting underperforming assets and pursuing growth opportunities in areas such as frozen foods.
The Swiss food and beverage giant first announced in 2024 that it would split its water and premium beverage businesses into a standalone operation, as part of a series of changes to cut costs by $2.8 billion by 2027.
Recently, new CEO Philipp Navratil has further advanced Nestlé's portfolio streamlining. Earlier this year, Nestlé sold Blue Bottle Coffee to Centurium Capital and its remaining ice cream business to Froneri. Additionally, Nestlé is seeking to sell its mainstream vitamins, minerals, and supplements business.
The new deal is expected to close in the first half of 2027, at which point Peranel's enterprise value will reach €4.9 billion (approximately $5.6 billion). The company will be headquartered in Paris and led by current business CEO Muriel Lienau.
"Through the partnership with Platinum Equity, Peranel will be better positioned to execute its strategy with greater flexibility," Nestlé CEO Philipp Navratil said in a statement. "With additional focus, it will be able to drive long-term growth goals by strengthening this unique portfolio of international and local brands, and continue to invest in innovation, premiumization, operational excellence, and sustainability."
The water and premium beverage business accounts for only about 4% of Nestlé's operations and has faced difficulties for years.
Nestlé reported on Thursday that first-half sales were CHF 43 billion (approximately $52.6 billion), down 2.5% year-over-year.