The London-based food products giant said on Thursday that ice cream is no longer a priority in its strategy, and it is now in active talks to sell the remainder of its ice cream business through the Froneri joint venture.<\/p>\n
The unit, which brings together the H\u00e4agen-Dazs and Drumstick brands, is valued at nearly 1 billion Swiss francs (about $1.3 billion). The company plans to transfer these brands from the United Kingdom to Froneri over the next year, while keeping its stake in the joint venture.<\/p>\n
Following the news, Nestl\u00e9\u2019s shares in early trading in Zurich rose about 3%, but later pared the gains.<\/p>\n
The move comes amid the efforts of new chief Philip Navratil to increase sales and simplify the company\u2019s complex operating structure. Navratil took over after the resignation of Laurent Freixes in September for failing to disclose a romantic relationship with a younger colleague.<\/p>\n
In its annual report Nestl\u00e9 said it would focus on four core areas: coffee, pet care, nutrition, and snacks.<\/p>\n
\u201cWe are focusing our portfolio on four areas led by our strongest brands.\u201d<\/p>\n
\u2013 Philip Navratil<\/p>\n
\u201cWe kept these six brands because we thought we could drive growth, but they do not have global scale. We cannot drive growth the way Froneri can.\u201d<\/p>\n
\u2013 Philip Navratil<\/p>\n
The Froneri Story and Market Context<\/p>\n
Froneri was formed more than a decade ago as a joint venture between Nestl\u00e9 and the British ice cream maker R&R. In 2019, Nestl\u00e9 sold Froneri\u2019s U.S. ice cream business for around $4 billion.<\/p>\n
Nestl\u00e9 is not the only big name in consumer goods rethinking its ice cream business: Unilever carved out its ice cream division into a separate company Magnum, to focus on other areas.<\/p>\n
As part of a restructuring the company also plans to cut about 16,000 jobs worldwide through automation and the use of artificial intelligence.<\/p>\n
Navratil\u2019s productivity push has faced challenges in the infant formula market.<\/p>\n
Nestl\u00e9, which markets Guigoz in France and SMA in the United Kingdom, said that supply shortages and recalls of some infant formulas could have slightly affected sales volumes this year.<\/p>\n
Last month the company recalled some batches of formulas from dozens of countries, including France and the United Kingdom, after traces of cereulide were found in product samples. Consuming cereulide can cause vomiting and diarrhea.<\/p>\n
French Danone also recalled some formulas, including Aptamil and Cow & Gate, in the United Kingdom.<\/p>\n
In a statement on its website this week, the French Ministry of Health said it is investigating cases of the deaths of three infants who consumed a formula linked to the recalls. <\/p>\n
\u201cTo date, the causal link has not been scientifically established.\u201d<\/p>\n
\u2013 French Ministry of Health<\/p>\n
Navratil stressed that Nestl\u00e9 has not yet contacted French authorities. He added that quality-control mechanisms detected cereulide in an oil-based mix used in formulas, but previously not considered to contain a toxin.<\/p>\n
The recalls also prompted the EU to introduce stricter standards for cereulide levels in infant products.<\/p>\n","protected":false},"excerpt":{"rendered":"The London-based food products giant said on Thursday that ice cream is no longer a priority in its…\n","protected":false},"author":2,"featured_media":14187,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","_share_on_mastodon":"0"},"categories":[126],"tags":[10289,9426,10290,199,10291,9421,10288,9415,1202,10292],"class_list":["post-14186","post","type-post","status-publish","format-standard","has-post-thumbnail","category-nestle","tag-baby-formula-recall","tag-froneri-joint-venture","tag-ice-cream-market","tag-nestle","tag-nestle-business-strategy","tag-nestle-ice-cream-sale","tag-nestle-ice-cream-sale-froneri-joint-venture-baby-formula-recall-nestle-business-strategy-philip-navratil-nestle-restructuring-ice-cream-market","tag-nestle-restructuring","tag-news","tag-philip-navratil"],"share_on_mastodon":{"url":"","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/14186","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/comments?post=14186"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/posts\/14186\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media\/14187"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/media?parent=14186"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/categories?post=14186"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/ch\/wp-json\/wp\/v2\/tags?post=14186"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}