Nestlé will raise approximately €3 billion ($3.4 billion) through the spin-off of its global water business into a new 50-50 joint venture with U.S. private equity firm Platinum Equity, as the Swiss food giant accelerates its strategy to streamline operations and focus on faster-growing product categories. The new company, named Peranel, has been assigned an enterprise value of €4.9 billion and is expected to begin operations after the transaction closes in the first half of next year.
The deal marks one of Nestlé’s biggest portfolio reshuffles in recent years. By separating its water business, the company aims to improve strategic flexibility while concentrating investment on higher-growth segments such as coffee, pet care, infant nutrition, and food brands.
Nestlé Creates Joint Venture With Platinum Equity
Nestlé will transfer its global water business into the newly formed company Peranel, which will be jointly owned by Nestlé and Platinum Equity.
The transaction values the business at approximately €4.9 billion, with Nestlé expected to receive around €3 billion in cash proceeds.
Deal Overview
| Item | Details |
|---|---|
| New Company | Peranel |
| Ownership | 50% Nestlé, 50% Platinum Equity |
| Enterprise Value | €4.9 billion |
| Cash Proceeds to Nestlé | Around €3 billion |
| Expected Closing | First half of next year |
Premium Water Brands Move Into Peranel
The new joint venture will manage Nestlé’s premium bottled water portfolio across more than 120 countries.
Brands included in the business include:
- Perrier
- S.Pellegrino
- Acqua Panna
- Nestlé Pure Life
- Several regional bottled water brands
Peranel will oversee more than 30 beverage and water brands, operating independently while benefiting from Platinum Equity’s operational expertise and Nestlé’s continued ownership stake.
Brands Included
| Premium Brands | Other Assets |
|---|---|
| Perrier | Regional water brands |
| S.Pellegrino | Local bottled water operations |
| Acqua Panna | Global distribution network |
| Nestlé Pure Life | Beverage portfolio |
Strategic Shift Toward Core Businesses
The transaction is part of Nestlé’s broader portfolio optimization strategy under CEO Philipp Navratil.
The company is increasingly focusing investment on higher-growth businesses, including:
- Coffee.
- Pet care.
- Infant nutrition.
- Food and snacks.
The water business has faced operational and regulatory challenges in recent years, particularly in France, where investigations into water treatment practices at some facilities have weighed on the division. Creating a standalone business is expected to give the unit greater operational flexibility while allowing Nestlé to sharpen its focus on its core brands.
Strong Sales Performance Supports Restructuring
Nestlé announced the transaction alongside better-than-expected second-quarter results.
The company reported:
| Metric | Q2 Performance |
|---|---|
| Organic Sales Growth | 3.7% |
| Previous Full-Year Guidance | Around 3% |
| Updated Guidance | 3%–4% organic sales growth |
Sales growth was supported by a combination of price increases and higher volumes, while the company said easing coffee and cocoa costs should help improve profitability during the second half of the year, despite continued pressure from transportation and energy costs.
Why the Deal Matters
The formation of Peranel reflects a broader trend among global consumer goods companies to streamline portfolios and focus on higher-margin businesses.
For Nestlé, the transaction offers several advantages:
- Immediate cash proceeds of approximately €3 billion.
- Continued exposure to the water business through a 50% stake.
- Greater strategic flexibility for Peranel.
- Increased focus on faster-growing consumer categories.
The partnership also allows Platinum Equity to invest in a globally recognized portfolio of premium water brands while leveraging its operational expertise to accelerate growth.
Looking Ahead
Nestlé’s decision to spin off its water business into the Peranel joint venture marks another significant step in its ongoing portfolio transformation. By raising approximately €3 billion while retaining a 50% ownership stake, the company strengthens its balance sheet and sharpens its focus on higher-growth categories such as coffee, pet care, nutrition, and food products.
Looking ahead, investors will closely monitor Peranel’s performance as an independent business and Nestlé’s ability to deploy the proceeds toward growth initiatives, innovation, and shareholder returns. If successful, the transaction could serve as a model for future strategic partnerships as consumer goods companies continue to optimize their portfolios in response to changing market dynamics.
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