Nestlé SA, the world’s biggest food company, sold the Juicy Juice fruit-drink brand to Brynwood Partners LP, as the Nescafé-maker trims underperforming assets.
Terms of the deal weren’t disclosed. The sale marks the Vevey, Switzerland-based company’s sixth deal with Greenwich, Connecticut-based Brynwood, a private equity firm led by Henk Hartong III, according to a statement from Brynwood.
Nestlé CEO Paul Bulcke has jettisoned slow-growing food and beverage brands as he ramps up investment in new areas such as skincare and nutrition. The company has also sold PowerBar snacks, Joseph’s Gourmet Pasta and most of its Jenny Craig diet-centre business over the past year.
“This is consistent with Nestlé’s portfolio management approach of focusing on core brands while divesting non-strategic ones,” Nestlé spokesman Robin Tickle said by phone.
Founded in 1977, the brand was acquired by Nestlé in 1986, when consumer demand for shelf-stable juices in the US was growing. The market has since waned on rising concerns that sugar-laden drinks contribute to obesity. An eight-ounce serving of Juicy Juice’s apple juice contains 26 grams of sugar, according to the brand’s website, which also claims that 'the best time' to begin drinking fruit juice is when a child is six to eight months old.
The $7.3-billion shelf-stable US juice market has shrunk 3 per cent a year since 2011, and has lower margins than categories like coffees and creamers, Nestlé said in an investor presentation last month. In that time, Juicy Juice’s market share has declined from 4.6 per cent to 3.9 per cent, the company said. The brand’s annual sales have declined to about $275 million from more than $500 million seven years ago, Hartong told The Wall Street Journal.
The US is Nestlé’s single-largest market, accounting for about 25 per cent of its $100 billion in sales.
Bloomberg News, edited by ESM
