Nestlé to divest stake in Swiss ingredients firm Givaudan

Nestlé is set to divest its 10% stake in Swiss manufacturer of flavourings and fragrances Givaudan in a deal valued at more than $1bn, as it seeks to streamline its portfolio.

As part of the deal, the company will sell its 926,562 shares in the Swiss manufacturer through a private placement to institutional investors such as pension funds.

The placement is currently underway and is being managed by Goldman Sachs.

Nestlé stated that the results of the placement will be announced once the process is complete.

In a statement, the company noted, "Nestlé has been very satisfied with its holding but believes now is the appropriate time to divest."

The KitKat chocolate bar makers gained control of the stake when it sold its food ingredient unit Food Ingredients Specialities (FIS) to Givaudan in 2002 for CHF750m in cash and stock.

Last month, Nestlé entered into an agreement to sell its Jenny Craig diet business operations in North America and Oceania to US-based private equity firm North Castle Partners.

In September Reuters reported that the company was considering selling its PowerBar energy bars brand due to stiffened competition in the market, citing sources familiar with the matter.

The sale processes come as Nestlé is looking to streamline its portfolio of 8,000 brands and is currently reviewing about 2,000 business units to improve its overall performance, after missing expectations in recent quarters.

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