Nestlé, the world’s largest food company, has entered into exclusive negotiations with FnB, a French investment fund, to sell its baby food brands in France, excluding milks. The deal would involve the brands sold in France and for export, as well as the plant in Arches that produces them. The deal is expected to be finalised by the first half of 2024.
Nestlé to focus on its infant formula business, a strategic pillar of the group
The Swiss food giant said that the decision to sell its baby food brands in France, excluding milks, was part of its strategy to strengthen the development of its infant formula business, which it described as “a historical and strategic pillar of the group”. The infant formula business includes brands such as Nidal and Guigoz, which are manufactured in Boué in northern France.
Nestlé said that the infant formula business was a high-growth and high-margin category, and that it had invested significantly in innovation, quality, and sustainability in this segment. The company said that it had recently launched new products, such as organic and plant-based infant formulas, and that it had improved its distribution and e-commerce channels.
The company also said that the infant formula business was aligned with its purpose of “unlocking the power of food to enhance quality of life for everyone, today and for generations to come”. The company said that it was committed to supporting the health and nutrition of mothers and babies, and to promoting breastfeeding as the best nutrition for infants.
Nestlé to sell its baby food brands, including NaturNes, Babicao, and P’tit
The baby food brands that Nestlé plans to sell in France, excluding milks, include NaturNes baby pots, chocolate and vanilla-flavoured cereals Babicao and Babivanille, and P’tit yogurt pots. These brands are produced in and exported from the plant in Arches, in the Vosges region, which has been operating since 1972.
Nestlé said that these brands had been facing challenges in the French market, such as declining demand, increased competition, and changing consumer preferences. The company said that these brands had limited growth potential and profitability, and that they did not fit with its strategic priorities.
The company said that it had explored various options to improve the performance of these brands, such as investing in modernisation, diversifying the product portfolio, and outsourcing some production to external partners. However, the company said that none of these options were viable or sustainable, and that it decided to sell these brands as a last resort.
Nestlé to support the employees and the local community affected by the deal
Nestlé said that it was aware of the social and economic impact of its decision to sell its baby food brands in France, excluding milks, and that it would support the employees and the local community affected by the deal. The company said that the deal would have no impact on the 234 employees who work in the production and marketing of these brands, and that they would be offered relocation or severance packages.
The company also said that it would work with the local authorities and the social partners to find a suitable buyer for the plant in Arches, and that it would contribute to the development of the local economy and employment. The company said that it would maintain a dialogue with all the stakeholders, and that it would respect the legal and social procedures.
The company said that its decision to sell its baby food brands in France, excluding milks, was part of its global strategy to optimise its manufacturing footprint, and to ensure its long-term competitiveness and growth. The company said that France remained a strategic market for the company, and that it was committed to offering high-quality products and services to its customers and consumers.