Analysts Predict Nestlé Will Divest Skin-Health Business To Focus on Beverages, Food

September 20, 2018: 12:00 AM EST

Nestlé may be planning to divest its $2.79 billion skin-health business as a way to placate an activist investor who believes the company should focus on food and beverages. Selling the unit could generate $4.1 billion, according to analysts, but the company did not comment on the speculation. Investor Daniel Loeb took a $3.5 billion stake in Nestlé last year and has since pressured the company to sell its investment in L’Oréal SA and in the skin-health arm set up in 2014 after Nestlé assumed full control of Galderma. CEO Mark Schneider has said the key to reviving stagnating growth is to focus on core areas with growth potential like coffee, pet care, water, and infant nutrition. Regarding coffee, the company recently bought the rights to market and sell Starbucks coffee and tea products in grocery and retail stores, and last year bought a majority stake in U.S. premium coffee chain Blue Bottle.

Saabira Chaudhuri and Brian Blackstone, "Nestlé Sharpens Focus on Food and Beverages With Review of Skin-Health Unit", The Wall Street Journal, September 20, 2018, © Dow Jones & Company Inc.

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Analysts Predict Nestlé Will Divest Skin-Health Business To Focus on Beverages, Food

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