Nestlé to sell its U.S. confectionery business for $2.8 billion
Nestlé has agreed to sell its U.S. confectionery business to Ferrero SpA for $2.8 billion in cash.
Based in Vevey, Switzerland, Nestlé’s U.S. headquarters is in Arlington. The company’s 2016 U.S. confectionery sales reached about $900 million.
The transaction is expected to close around the end of the first quarter of 2018 following the completion of customary approvals and closing conditions.
With this transaction, Alba, Italy-based Ferrero will become the third-largest confectionary company in the U.S.
The business includes chocolate brands such as Butterfinger, Crunch, BabyRuth, 100Grand, Raisinets, Chunky, OhHenry! and SnoCaps, as well as sugar brands such as SweeTarts, LaffyTaffy, Nerds, FunDip, PixyStix, Gobstopper, BottleCaps, Spree and Runts.
The transaction covers the U.S.-focused confectionery brands only and does not include Nestlé's Toll House baking products.
The company said it also remains committed to growing its international confectionery products, particularly its global brand KitKat.
The U.S. is Nestlé's largest market, with sales of around $27 billion in 2016. Nestlé products include brands such as Purina, Nestlé Pure Life, Coffee-Mate, Gerber and Stouffer's.
The company employs 50,000 people in more than 120 locations in the U.S., including 77 factories and 10 R&D centers.