Nestlé has agreed to sell its US ice cream business to Froneri, an ice cream-focused joint venture Nestlé created in 2016 with PAI Partners, for $4 billion.
With brands such as Häagen-Dazs, Drumstick and Outshine, Nestlé’s US ice cream unit posted turnover of $1.8 billion in 2018.
This year, Froneri has acquired Fonterra’s ice cream business Tip Top as well as Nestlé’s ice cream unit in Israel.
In 2016, Nestlé and private equity firm PAI Partners merged Nestlé’s European ice cream business in 20 countries and PAI-owned R&R to create Froneri. Last year, Froneri recorded turnover of around CHF 2.9 billion ($2.95 billion).
“The creation of Froneri has been a phenomenal success,” said Nestlé CEO Mark Schneider. “We are now making this business our global strategic partner in ice cream and are convinced that Froneri’s successful business model can be extended to the US market. With this transaction, we are taking a decisive step towards our goal of achieving global leadership in ice cream.”
Ibrahim Najafi, Froneri CEO, said: “This is another milestone acquisition for Froneri as we drive towards becoming the world’s best ice cream company. We’re delighted to be bringing such well-loved US brands into the Froneri family. The acquisition is testament to the strength and longevity of our relationship with Nestlé.
“This partnership and the continued support of PAI Partners will be essential to ensuring we continue to delight consumers with innovative, high-quality products in all markets.”
Frédéric Stévenin, partner at PAI Partners, added: “We are excited to bring Nestlé’s stellar US ice cream business to Froneri. This is a great opportunity for further growth, building on the expertise of the world’s leading pure-play ice cream company.”
The transaction is expected to close in the first quarter of 2020. Nestlé will continue to manage its remaining ice cream businesses in Canada, Latin America and Asia.
© FoodBev Media Ltd 2020