Geneva – The famous Gerber Baby will change parents, with Nestlé SA announcing Thursday that it will buy Gerber Products Co. for $5.5 billion, giving the world’s biggest food and drink company the largest share of the global baby-food market.
The acquisition from pharmaceutical maker Novartis SA helps further Nestlé’s recent focus on health and nutrition, following its purchases of the U.S. weight-control company Jenny Craig and Novartis Medical Nutrition.
Nestlé, which owns brands such as Nescafé, Perrier and Dreyer’s, is also the world’s largest manufacturer of infant nutritional products – largely through its presence in developing countries – but had no presence in baby food in the U.S.
The cherubic face of the happy Gerber infant dominates the U.S. baby-food market, with the company holding a 79 percent share, according to Morgan Stanley.
“The acquisition of Gerber is the perfect complementary fit,” said Nestlé chairman and chief executive Peter Brabeck-Letmathe. “It not only gives Nestlé the leadership position in baby food, but it also constitutes a decisive step to establish Nestlé Nutrition as the undisputed global leader in the nutrition field.”
Adding Gerber will help the company’s nutrition business generate annual sales of close to $8.2 billion.
