Nestle Waters springs for Henniez

By Neil Merrett

- Last updated on GMT

Related tags: Nestlé waters, Bottled water, Switzerland

Nestle will expand its dominance in the bottled water market
after today agreeing to the acquisition of a majority share in
Switzerland-based Sources Minérales Henniez.

Through its Nestle Waters division, the company will pay CHF155m (€94m) for the 66 per cent stake held by current majority shareholder, the Rouge family. Nestle said it would make a public offer for the remaining shares on the Swiss stock exchange. The purchase comes as the bottled water market continues to enjoy strong growth on the back of a changing consumer demands away from carbonated soft drinks and towards healthier beverages. Through the purchase, Nestle Waters will gain Henniez's three production sites in the Swiss cantons of Vaud and Valais, along with its Henniez and Cristalp brands that last year. The whole group had sales of CHF152m (€92m) in 2006. With an annual bottled water consumption of 127 litres per capita, the Swiss market is above the European consumption average with further growth expected at one per cent to two per cent annually, the company said. With the addition of Henniez's assets, Nestle Waters would then hold about a 25 per cent share of the country's market for the product, should the acquisition gain regulatory approval. Nestle Waters' chief executive officer Carlo Donati said the purchase continued the group's strategy for expanding its operations globally by meeting consumer demand at a local level. "Henniez perfectly strengthens our existing activities in Switzerland,"​ he stated. "It brings us modern industrial capacity adapted to evolving consumer needs, a strong distribution network, as well as prestigious local brands." ​ Nestle added that it will continue to work with Henniez's joint-venture partners in the country, to retain production of the popular Granini and Hohes C brands. Nestle will also continue to sell its own S. Pellegrino, Vittel, Contrex, Acqua Panna and Perrier brands on the market, which last year posted combined sales of CHF77m (€46m) in the country. Nestle Waters has throughout the year moved to restructure its operations in a number of markets to ensure it continues to lead the global bottled water market. The company announced in January that it had formed a strategic alliance with Mexican beverage group Modelo, before selling off its Filipino operations to local group Universal Robina Corp (URC) to produce its brands under license. Earlier this year, the company announced that its global sales in 2006 grew by 9.4 per cent to €6.1 billion, allowing the group to claim a dominant 19.1 per cent share of the global bottled water market.

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