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Nestlé Explores Sale Of Pure Life In Overhaul Of Water Business

Published on Jun 15 2020 2:59 PM in A-Brands tagged: Trending Posts / Nestlé / North America / Pure Life

Nestlé Explores Sale Of Pure Life In Overhaul Of Water Business

Nestlé is exploring a potential sale of part of its North American water business, including the Pure Life brand, as the food giant shifts focus to better performing brands.

The business under review also includes regional spring water brands like Poland Spring and generated sales of CHF3.4 billion (€3.2 billion) last year, accounting for almost half of total water revenue.

Nestlé Waters has struggled for years, posting just 0.2% growth last year, prompting an overhaul of the business late last year.

"We are withdrawing from a bulk business to focus on high-value (water) specialities," Nestlé chief executive Mark Schneider told Reuters by phone. "We can then grow...organically and through acquisitions."

Strategic Review

Nestlé, known for KitKat chocolate bars and Nescafe coffee, said it was expecting to conclude a strategic review by early 2021. It has lagged rivals PepsiCo, LaCroix and Coca-Cola in sparkling and flavoured waters in the US.

"We are not withdrawing from water in the US", Schneider said, adding that he wanted to keep pushing international brands Perrier, S.Pellegrino and Acqua Panna that were "very successful" in the country.

"In the right segments, water remains very attractive," he said, pointing to growth and margin opportunities.

Environmental Concerns

Bottled water sales have come under pressure, as environmental concerns about plastic waste and transportation lead more people to drink from the tap.

Nestlé, often criticised by environmentalists, vowed to make its entire water portfolio carbon neutral by 2025.

Nestlé, which has also been shedding underperforming brands in other product categories, posted its best quarterly sales growth in nearly five years in April as customers stocked up on well known brands during the pandemic.

News by Reuters, edited by ESM. Click subscribe to sign up to ESM: European Supermarket Magazine.

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