Essentia Water will become part of Nestlé USA's premium water portfolio, which includes the Perrier, S.Pellegrino, and Acqua Panna brands.
Essentia Water marks the first acquisition Nestlé USA has made to its premium water portfolio since buying S. Pellegrino in 1997. Last month the company announced it would be selling its Nestlé Waters North America business – including brands Pure Life, Poland Spring, Deer Park, Ozarka, and delivery service ReadyRefresh – for $4.3bn.
The move to offload such a large part of its business (that generated roughly $3.64bn in sales in 2019) would allow the company to focus on growing its premium bottled water portfolio, said Nestlé USA.
"In June 2020 we announced that we would be transforming our global water portfolio to focus on international premium and mineral water brands and healthy hydration products such as functional water," a Nestlé USA spokesperson told FoodNavigator-USA.
"The move also complements our broader US beverage and ready to drink strategy, as we work to deliver delicious, healthy beverages that consumers are seeking - be it energizing, refreshing, indulgent or functional."
The acquisition of Essentia Water, which positions itself as a "supercharged ionized alkaline water" containing trace amounts of rehydrating electrolytes, will help Nestlé establish a foothold in the high-growth, US functional water set, dominated by its competitors (Coca-Cola's SmartWater and PepsiCo-owned LIFEWTR).
According to Fortune Business Insights, the global functional water market size was worth $10.34bn in 2017 and is projected to reach $18.24bn by the end of 2025, registering a CAGR of 7.4% in the forecast period.
North America holds a lion's share of the functional water market with well-developed brands, and the US leads in sales of this growing market, notes Fortune Business Insights.
'Essentia gives us an immediate strong position in the functional water market'
Founded in 1998 by Ken Uptain, Essentia Water uses a proprietary three-step ionization process to achieve a pH of 9.5 or higher and delivers a "clean, smooth taste" along with superior rehydration properties*, the company claims.
Available in over 50,000 US locations and listed on Amazon, Essentia generated $192m in sales in 2020.
A Nestlé USA spokesperson also told FoodNavigator-USA, "We are investing for the future. Essentia is the leading alkaline water brand and the No. 1 selling bottled water brand in the natural channel. Acquiring Essentia gives us an immediate strong position in the functional water market, and one we can leverage to seize the opportunities in that growing segment."
From a brand awareness standpoint, Essentia has made significant strides as an independent company in the past five years with a growing influencer program that includes professional athletes, musicians, and chefs.
In a statement, Steve Presley, chairman and CEO of Nestlé USA, said, “With the addition of Essentia we continue to transform and best position our water business for long-term profitable growth here in the U.S. and globally.”
*Essentia Water cites a 2014 clinical study published in Journal of the International Society of Sports Nutrition in 2016, which found that Essentia bottled water was shown to reduce blood viscosity significantly 120 minutes after exercise-induced dehydration.