Swiss food and nutrition giant Nestle will shell out $11.9 billion to buy Pfizer’s nutrition unit, which owns baby food brands such as SMA and Promil.
The division is expected to reel in $2.4 billion in sales this year and gets 85% of its revenue from emerging markets, whose large and rapidly growing populations are a key target for Nestle.
The Pfizer infant formula business is the fifth largest in the world, according to research group Euromonitor International, ranked behind Nestle, Mead-Johnson Nutrition Co., Groupe Danone and Abbot Laboritories.
Nestle, which last year ranked as the most profitable corporation in the Fortune Global 500, owns infant product brands Gerber, Cerelac and Nan. It's U.S. operations are based in Glendale.
Last week, the company said that its first quarter sales were up 7.2% to 21.4 billion Swiss francs, or $23.3 billion. Growth was up 3.1% in developed markets such as North America, where expansion slowed dued to weak consumer sentiment and higher pricing for products such as frozen foods.
But in emerging markets, sales were up 13%.
-- Tiffany Hsu, Los Angeles Times