Nestle to Pick Advent, KKR, EQT for Skin-Health Unit Bid

(Bloomberg) -- Nestle SA has selected a slew of private equity firms and consumer companies to participate in the next round of an auction for its skin-health business in one of the most hotly contested asset sales in Europe this year, people familiar with the matter said.

A consortium that includes Advent International, Cinven and GIC Pte, as well as KKR & Co. and EQT Partners, are among the firms brought through to the second round, the people said, asking not to be identified because the deliberations are private. Paris-based makeup giant L’Oreal SA, Unilever NV and Carlyle Group LP have also been invited to the second round to bid for parts of Nestle’s business, they said.

Nestle may fetch $8 billion to $10 billion for the assets and the company would prefer to sell the unit as a whole, even though it’s considering a piecemeal sale if that generates a higher value, the people said. On Tuesday, the company was still informing bidders that made it into the next round, they said.

That value would make the unit the largest acquisition target in Europe this year, surpassing Hellman & Friedman and Blackstone Group LP’s $5.5 billion offer for Germany’s Scout24, according to data compiled by Bloomberg.

No final decisions have been made and the companies may decide against proceeding with the auction, the people said. Representatives for Nestle, L’Oreal, Unilever, GIC and the private equity firms declined to comment.

2,000 Brands

Nestle has been selling off assets after activist investor Dan Loeb last year called on the world’s largest food company to conduct a review of its more than 2,000 brands.

Nestle’s Chief Executive Officer Mark Schneider put the skin-health business up for review in October, but the company said the process wouldn’t necessarily lead to a sale. The company’s Chairman, Paul Bulcke, signaled in January that he’d be open to a full sale so the company can focus on its core food business.

The unit, which makes products ranging from prescription skin medications to injectable skin fillers, has been suffering from increased competition from generics.

--With assistance from Robert Williams, Thomas Buckley, Corinne Gretler, Joyce Koh, Dinesh Nair, Aaron Kirchfeld and Ruth David.

To contact the reporters on this story: Sarah Syed in London at ssyed35@bloomberg.net;Jan-Henrik Förster in Zurich at jforster20@bloomberg.net;Manuel Baigorri in Hong Kong at mbaigorri@bloomberg.net

To contact the editors responsible for this story: Dinesh Nair at dnair5@bloomberg.net, Amy Thomson, Michael Hytha

©2019 Bloomberg L.P.