Key Takeaways
- • Nestlé has completed a definitive agreement to spin off its water business into a 50-50 joint venture called Peranel with U.S. private equity firm Platinum Equity, valuing the unit at €4.9 billion and CHF 4.5 billion.
- • Nestlé will receive CHF 2.8 billion in proceeds from the partial sale, with the transaction expected to close by H1 2027, subject to employee consultation and regulatory approvals.
- • The water business, comprising premium brands including Perrier and San Pellegrino, generated approximately CHF 3.5 billion in annual revenue (just under 4% of group turnover) and has been burdened by regulatory challenges, including a 2025 scandal involving unauthorized mineral water treatment in France.
- • The divestiture represents a strategic priority under new CEO Philipp Navratil's restructuring agenda, following Nestlé's initial 2024 announcement to exit the water segment and organizational spin-off in 2025.
- • The transaction will relocate the water business headquarters to Paris under the Peranel structure, enabling Nestlé to focus capital and management resources on higher-growth segments while monetizing an underperforming asset.
Summary
Nestlé has formalized plans to divest its water business through a joint venture structure with Platinum Equity, a U.S. private equity firm. The transaction establishes Peranel as a 50-50 partnership headquartered in Paris, with both parties holding equal stakes in the combined water operations. The valuation stands at €4.9 billion and CHF 4.5 billion, with Nestlé receiving CHF 2.8 billion upon completion, expected in the first half of 2027.
The water division encompasses several flagship brands, most notably Perrier and San Pellegrino, which collectively generated approximately CHF 3.5 billion in annual revenue, representing just under 4% of Nestlé's total turnover. This spin-off aligns with Nestlé's stated strategy to streamline its portfolio away from lower-margin, commodity-exposed segments. The transaction requires completion of employee consultation processes and regulatory approvals before closing.
The divestiture marks the culmination of a multi-year strategic review initiated in 2024, when Nestlé first signaled intent to exit the water business. The division was formally carved out as a standalone entity effective January 1, 2025, followed by the launch of a structured sale process in early 2026. The timing reflects both portfolio optimization and operational challenges that have plagued the water unit, particularly a 2025 scandal involving unauthorized treatment methods for mineral water in France, which resulted in regulatory scrutiny and reputational pressure.
The transaction is a centerpiece of restructuring initiatives under CEO Philipp Navratil, who assumed leadership with a mandate to enhance profitability and redirect capital toward higher-growth consumer segments. By partnering with Platinum Equity, Nestlé gains operational flexibility and capital relief while preserving ongoing involvement through equal ownership, positioning the water business for potential expansion under specialized private equity management focused on premium beverage optimization.
The water division encompasses several flagship brands, most notably Perrier and San Pellegrino, which collectively generated approximately CHF 3.5 billion in annual revenue, representing just under 4% of Nestlé's total turnover. This spin-off aligns with Nestlé's stated strategy to streamline its portfolio away from lower-margin, commodity-exposed segments. The transaction requires completion of employee consultation processes and regulatory approvals before closing.
The divestiture marks the culmination of a multi-year strategic review initiated in 2024, when Nestlé first signaled intent to exit the water business. The division was formally carved out as a standalone entity effective January 1, 2025, followed by the launch of a structured sale process in early 2026. The timing reflects both portfolio optimization and operational challenges that have plagued the water unit, particularly a 2025 scandal involving unauthorized treatment methods for mineral water in France, which resulted in regulatory scrutiny and reputational pressure.
The transaction is a centerpiece of restructuring initiatives under CEO Philipp Navratil, who assumed leadership with a mandate to enhance profitability and redirect capital toward higher-growth consumer segments. By partnering with Platinum Equity, Nestlé gains operational flexibility and capital relief while preserving ongoing involvement through equal ownership, positioning the water business for potential expansion under specialized private equity management focused on premium beverage optimization.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.