Nestlé S.A. today announced that it has reached an agreement to sell its regional spring water brands, purified water business and beverage delivery service in the U.S. and Canada to investment firm One Rock Capital Partners in partnership with family-owned Metropoulos & Co. for USD 4.3 billion. Metropoulos is not new to the industry as it has a successful 40-year track record of transforming scores of companies and reinvigorating numerous food and beverage brands, including Hostess Brands and Pabst Brewing Company.
Nestlé Waters North America is headquartered in Stamford, Connecticut and employs approximately 7,000 people in the US and more than 230 in Canada. It has 27 production facilities across North America and operates the direct-to-consumer and office beverage delivery service ReadyRefresh.
The sale comprises ReadyRefresh and eight brands, including Poland Spring Natural Spring Water, Deer Park Natural Spring Water, Ozarka Natural Spring Water, Ice Mountain Natural Spring Water, Zephyrhills Natural Spring Water, Arrowhead Mountain Spring Water, Pure Life and Splash in the U.S. and Canada, with sales of around USD 3.8 bbillion in 2019.
The company's international premium brands including Perrier®, S.Pellegrino® and Acqua Panna® are not a part of the deal. The transaction is expected to close following the completion of customary closing conditions.
Bottled water sales have come under pressure amid environmental concerns about plastic waste and transportation. As a consequence Nestlé conducted last year a strategic review of its waters division and has committed to make its entire water portfolio carbon neutral by 2025. In order to achieve this, Nestlé is investing USD 2 billion in creating a market for recycled plastic and has decided to sharpen the focus of its global water portfolio.
In August last year, the company already sold its portfolio of local Chinese water brands to Tsingtao Brewery Group, China’s second largest brewing group. The transaction involved the transfer of ownership of the local brand Dashan Yunnan Shan Quan and three factories located in Kunming of Yunnan province, Shanghai and Tianjin. (inside.beer, 28.8.2020)
Commenting on the most recent transaction in North America, Mark Schneider, Nestlé CEO, said: "We continue to transform our global waters business to best position it for long-term profitable growth. This sale enables us to create a more focused business around our international premium brands, local natural mineral waters and high-quality healthy hydration products. We will also boost our innovation and business development efforts to capture emerging consumer trends, such as functional water."
