(March 27): PAI Partners and Bain Capital are among buyout firms considering bids for Nestlé SA’s water business, which could be valued at about €5 billion (US$5.4 billion or RM23.9 billion) or more in a deal, according to people familiar with the matter.

Clayton Dubilier & Rice and KKR & Co have also been studying the business, said the people, who asked not to be identified as the information is private. Nestlé may retain a stake in the unit in any transaction, the people said. Nestlé is likely to appoint investment banks to advise on options for the water business in the coming days, they said.

Deliberations are ongoing and may not result in a deal, according to the people. Representatives of Nestlé, Bain, CD&R, KKR and PAI declined to comment.

Nestlé chief executive officer Laurent Freixe late last year announced plans to separate the water business, which includes brands such as Perrier, S Pellegrino and Acqua Panna, after the unit’s organic growth has slowed in recent quarters. Management is set to evaluate its strategy, including partnership opportunities. The water business accounts for less than 4% of Nestlé’s total revenue and has struggled of late from contamination issues and supply constraints.

PAI and Nestlé have been running joint ventures for their ice cream and frozen pizza assets. Froneri, which holds brands like Haagen-Dazs, was created in 2016 when the Swiss company merged its European ice cream business with PAI-owned R&R Ice Cream. In 2019, Nestlé sold its US ice cream operation to Froneri for US$4 billion. Four years later, the duo established a joint venture for Nestlé’s frozen pizza business in Europe.

Uploaded by Tham Yek Lee