Nestlé is selling 50% of its bottled water business for €3 billion as part of CEO Philippe Navratil’s broader restructuring plan for the Swiss food giant. The move comes amid strong performance in coffee and snack categories — areas Nestlé is now prioritizing.
A New Joint Venture with Platinum Equity
The company is divesting a portfolio of well-known water brands, including Perrier and S.Pellegrino, to Platinum Equity, a U.S.-based private equity firm. Under the agreement, Nestlé and Platinum Equity will form a 50–50 joint venture named Peranel, valued at €4.9 billion.
Strategic Shift Toward Core Brands
This sale marks a key step in Nestlé’s strategic refocusing on high-growth, core businesses. Since April, the company has begun rolling out this plan — first by selling Blue Bottle Coffee, and now by pursuing divestments of its underperforming vitamin unit and ice cream business.
Bottled water operations have faced headwinds in recent years due to declining consumer demand and scrutiny over filtration and processing methods used in certain products.
Strong Growth in Coffee and Snacks
In contrast, Nestlé’s coffee and snack divisions are thriving. In the first half of the year, organic sales for Nespresso — the capsule coffee maker — and KitKat chocolate bars rose 3.6%, slightly ahead of analysts’ 3.5% forecast.
Coffee overall delivered 7.5% organic sales growth in the same period, led by Nescafé. Growth in food and snacks was driven by brands such as Maggi and KitKat.
Navratil’s Early Impact
Less than a year into his tenure, Navratil aims to demonstrate sustainable volume growth while simultaneously cutting costs. So far, the strategy appears to be resonating: Nestlé’s shares are up 9.4% year-to-date and around 11% over the past 12 months — outperforming rival Unilever, whose stock has fallen 3.3% since last July.