Nestlé SA will carve out its Waters & Premium Beverages business into a 50:50 joint venture with private equity firm Platinum Equity in a deal valuing the unit at €4.9 billion, as the world’s largest food company continues its portfolio overhaul amid weaker first-half earnings.
The new company, to be known as Peranel, will own leading water brands including Perrier, S.Pellegrino, Acqua Panna and Nestlé Pure Life. The transaction is expected to close in the first half of 2027, subject to regulatory approvals and employee consultation.
Nestlé said the deal would generate approximately €3 billion (CHF2.8 billion) in cash proceeds, providing additional financial flexibility as it streamlines its operations.
The announcement came alongside the group’s first-half financial results, which showed net profit fell 31.4 per cent year-on-year to CHF3.47 billion. The decline was largely driven by restructuring costs and asset write-downs.
Sales slipped 2.5 per cent to CHF43.1 billion during the period, although organic sales growth improved to 3.6 per cent. Nestlé maintained its full-year guidance, forecasting organic sales growth of between 3 and 4 per cent and free cash flow of more than CHF9 billion.
Despite reaffirming its outlook, investors reacted negatively to the results. Nestlé shares fell more than 6 per cent, reaching their lowest level since 24 June and underperforming the broader Swiss Market Index, which declined by more than 1 per cent.
Morgan Stanley said the results were broadly in line with market expectations but anticipated a weaker share price response, noting that investor expectations had risen ahead of the earnings release.
The investment bank added that first-half operating margins benefited from one-off pension accounting adjustments and the earlier recognition of cost savings. It cautioned that Nestlé’s guidance for broadly flat margins in the second half suggested a lower earnings trajectory heading into 2027.
RBC Capital Markets also described the results as broadly in line with expectations. The brokerage highlighted stronger-than-expected sales growth across Asia, Oceania and Africa, which helped offset weaker performances in the Americas and Europe.
RBC added that the €4.9 billion valuation for the Waters & Premium Beverages business was consistent with market expectations and was unlikely to result in significant changes to earnings forecasts.
The creation of Peranel marks another significant step in Nestlé’s long-term strategy to reshape its portfolio by focusing on higher-growth businesses while unlocking value from selected assets.
