A picture taken on November 19, 2020 shows Swiss food giant Nestle logo at their headquarters in Vevey ahead of a November 29, 2020 nationwide vote on a people's initiative to impose due diligence rules on Swiss-based firms active abroad.<\/p>\n
FABRICE COFFRINI | AFP | Getty Images<\/p>\n
Nestle is in talks to buy nutritional supplement maker The Bountiful Company, the Swiss food giant said on Monday, as it looks to move further into a health and nutrition sector that is growing faster than its traditional packaged food business.<\/p>\n
Analysts expect a price tag of $5-$7 billion for Bountiful, which makes Nature's Bounty vitamins, Osteo Bi-Flex joint-care supplements and Puritan's Pride vitamins and supplements, but Nestle in its statement gave no indication of a price.<\/p>\n
The acquisition would fit with the M&A strategy of Chief Executive Mark Schneider, the former Fresenius boss who has targeted several health companies since taking charge at Nestle in 2016.<\/p>\n
\"Nestl S.A. today announced that it is in discussions to acquire all or part of The Bountiful Company,\" Nestle said, confirming media reports but giving no further details.<\/p>\n
Separately, Knorr soup maker Unilever said on Monday it would buy food supplements maker Onnit.<\/p>\n
Nestle's approach for Bountiful, which is majority-owned by private equity firm KKR Co & Inc, came after Bountiful filed for a New York Stock Exchange flotation this month.<\/p>\n
In 2020, Long Island-based Bountiful had sales of $2.07 billion, 10% higher than a year earlier. It increased its adjusted earnings before interest, tax, depreciation and amortization by 21% to $302.3 million.<\/p>\n
In its 2019 results, before the pandemic struck, Nestle increased reported sales only by 1.2%, held back by sluggish performances in water, confectionary and prepared dishes.<\/p>\n
\"This is about diversifying the growth profile in Nestle and trying to get growth in areas other than coffee and pet care,\" said Bank Vontobel analyst Jean-Philippe Bertschy, who said a move for Bountiful made strategic sense for the world's largest packaged food company.<\/p>\n
In the past five years, nutritional food sales have increased by an average of 5.8% per year, faster than the 4.7% rate of packaged foods, according to Euromonitor data.<\/p>\n
Only 17% of the estimated $137 billion in annual global sales in nutritional food are generated in Europe, Middle East and Africa, offering scope for further expansion in the region.<\/p>\n
Meanwhile, 17% of Bountiful's sales come form e-commerce, a faster growing retail channel than shops, while Nestle could leverage its distribution and marketing to increase sales further.<\/p>\n
\"I think the health and wellness area will continue to be the focus of Nestle's M&A activity, because of the faster growth and higher returns,\" said Bertschy.<\/p>\n
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Nestle in talks to buy Nature's Bounty vitamins - CNBC<\/a><\/p>\n","protected":false},"excerpt":{"rendered":" A picture taken on November 19, 2020 shows Swiss food giant Nestle logo at their headquarters in Vevey ahead of a November 29, 2020 nationwide vote on a people's initiative to impose due diligence rules on Swiss-based firms active abroad. Continue reading