Nestle Is Working With Advisers to Review Skin-Health Unit
(Bloomberg) -- Nestle SA is working with advisers on the potential sale of its skincare division as the Swiss firm moves ahead with plans to narrow its sprawling business interests, people familiar with the matter said.
Credit Suisse Group AG is one of the banks that Nestle is working with on the review, which could value the business at $8 billion to $10 billion, the people said, asking not to be identified as the appointment is private. The division may attract bids from personal-care companies such as Johnson & Johnson and private equity firms including KKR & Co. and Apax Partners, they said.
Representatives for Nestle, Credit Suisse, J&J, KKR and Apax declined to comment.
Nestle, which owns brands from Nespresso coffee to Purina pet food, is weighing selling the dermatological operations as a whole or in parts and would also consider a spin-off, though that option is less likely, the people said. No final decisions have been made and the deliberations are at an early stage, they said.
Nestle said last month that it was exploring options for its skin-health business as Chief Executive Officer Mark Schneider focuses on core products such as coffee, water and pet food. Nestle said that it expects to complete the review of the business -- which owns the Cetaphil lotion and Proactiv acne treatment brands as well as wrinkle removers that compete with Botox -- by the middle of next year.
The consumer giant last year caught the attention of activist investor Dan Loeb, who called on it to conduct a review of its brands and get rid of underperformers that were holding back growth. Nestle has agreed to sell its U.S. confectionery business to Nutella maker Ferrero SpA for $2.8 billion, and offloaded Gerber Life Insurance in a $1.55 billion deal with Western & Southern Financial Group. The company is also considering selling hot-dog maker Herta, a person familiar with the situation said in June.
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