Key Takeaways
- • PAI Partners has withdrawn from the final bidding process for Nestlé's €5 billion water business, narrowing the competitive field to Clayton Dubilier & Rice (CD&R) and Platinum Equity, led by billionaire Tom Gores.
- • The divestment targets a 50% stake in Nestlé's European water division, which includes premium brands Perrier and S.Pellegrino; Deutsche Bank and Rothschild are advising on the transaction.
- • KKR previously dropped out of the bidding process in recent weeks, further consolidating the buyer pool and potentially strengthening negotiating positions for the two remaining sponsors.
- • The withdrawal of PAI—a long-time private equity partner of Nestlé—signals shifting dynamics in the competitive process as bidders advance to final stages of due diligence and valuation.
Summary
Nestlé's planned divestment of a 50% stake in its European water business has entered a critical consolidation phase as PAI Partners withdrew from the bidding process on June 8, 2026. The exit leaves CD&R and Platinum Equity as the sole remaining bidders competing for the asset, according to Bloomberg News reporting confirmed by Reuters. The development marks a significant narrowing of the competitive field after multiple rounds of bidding that initially attracted broader private equity interest.
The water business under divestment is valued at approximately €5 billion and represents a crown jewel within Nestlé's portfolio, encompassing iconic global brands including Perrier and S.Pellegrino. Deutsche Bank and Rothschild have been retained as financial advisors on the transaction, underscoring the strategic importance and complexity of the sale process. The deal structure calls for the sale of a minority stake rather than a full divestment, allowing Nestlé to retain a controlling position in the business while monetizing equity value.
PAI Partners' exit follows KKR's withdrawal from the bidding process in recent weeks, effectively eliminating two major financial sponsors from contention. PAI had previously maintained a significant relationship with Nestlé, including a joint venture in the frozen pizza business in Europe and a 50% stake in Froneri, the ice cream joint venture with the consumer goods giant. The decision to withdraw suggests PAI assessed the valuations or terms as uncompetitive relative to alternative deployment opportunities for capital.
The remaining bidders—CD&R and Platinum Equity—now face the final phase of bidding, with second-round bids expected to materialize within eight to ten weeks from the initial announcement. Both sponsors bring substantial capital resources and relevant sector experience to evaluate the water business's strategic and financial potential. Nestlé declined to comment on the process, maintaining standard confidentiality protocols typical of large M&A transactions, while the bidding firms and their advisors similarly refrained from immediate public response.
The water business under divestment is valued at approximately €5 billion and represents a crown jewel within Nestlé's portfolio, encompassing iconic global brands including Perrier and S.Pellegrino. Deutsche Bank and Rothschild have been retained as financial advisors on the transaction, underscoring the strategic importance and complexity of the sale process. The deal structure calls for the sale of a minority stake rather than a full divestment, allowing Nestlé to retain a controlling position in the business while monetizing equity value.
PAI Partners' exit follows KKR's withdrawal from the bidding process in recent weeks, effectively eliminating two major financial sponsors from contention. PAI had previously maintained a significant relationship with Nestlé, including a joint venture in the frozen pizza business in Europe and a 50% stake in Froneri, the ice cream joint venture with the consumer goods giant. The decision to withdraw suggests PAI assessed the valuations or terms as uncompetitive relative to alternative deployment opportunities for capital.
The remaining bidders—CD&R and Platinum Equity—now face the final phase of bidding, with second-round bids expected to materialize within eight to ten weeks from the initial announcement. Both sponsors bring substantial capital resources and relevant sector experience to evaluate the water business's strategic and financial potential. Nestlé declined to comment on the process, maintaining standard confidentiality protocols typical of large M&A transactions, while the bidding firms and their advisors similarly refrained from immediate public response.
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