Nestlé to Spin Off Water Brands Including Perrier in $5.6 Billion Joint Venture

Nestlé SA announced on Thursday it will carve out its Waters & Premium Beverages business into a 50:50 joint venture with private equity firm Platinum Equity. The transaction values the new entity, to be named Peranel, at €4.9 billion ($5.6 billion).

Deal Details

The new jointly-owned company will house some of Nestlé's most well-known water brands. According to the company's statement, the portfolio will include:

• Perrier
• S.Pellegrino
• Acqua Panna
• Nestlé Pure Life

The deal is expected to generate approximately €3 billion (CHF2.8 billion) in cash proceeds for Nestlé. The transaction is slated to close in the first half of 2027, pending customary regulatory approvals and employee consultations.

Broader Financial Performance

Ad

The announcement coincided with the release of Nestlé's first-half financial results. The world's largest packaged food company reported a net profit of CHF3.47 billion, a decrease of 31.4% from the prior year, which it attributed to restructuring charges and write-downs.

First-half sales slipped 2.5% to CHF43.1 billion. However, the company saw its organic growth improve to 3.6% and maintained its full-year outlook for organic sales growth of 3% to 4%. Nestlé also said it expects free cash flow to exceed CHF9 billion for the year.

Market Reaction and Context

Analysts at RBC Capital Markets described Nestlé's first-half results as "satisfactory" and broadly in line with market consensus, according to a note cited by Investing.com. The brokerage noted that stronger-than-expected sales growth in Asia, Oceania, and Africa helped offset softer performance in the Americas and Europe.

RBC also stated that the €4.9 billion valuation for the water business was consistent with market expectations. The move allows Nestlé to streamline its portfolio and focus on higher-growth categories while partnering with a specialist firm to manage the capital-intensive water business.