In a trading update on Thursday, Nestl\u00e9 announced that it had launched a strategic review of its VMS assets that fell under the Bountiful deal, including Nature\u2019s Bounty, Osteo Bi-Flex and Puritan\u2019s Pride. The assets were bought in 2021 by former CEO Mark Schneider as part of a series of acquisitions. <\/p>\n
The brands fall within Nestl\u00e9\u2019s Health Science portfolio, which also holds the Atrium Innovations VMS assets acquired for $2.3 billion in 2017.<\/p>\n
According to the Financial Times<\/a>, Nestl\u00e9\u2019s review is linked to current company CEO Laurent Freixe\u2019s efforts to turn around Nestl\u00e9\u2019s \u201csluggish\u201d performance by launching a $2.8 billion cost-cutting effort. The Times said Nestl\u00e9 would likely focus its vitamin business on global, higher-end products including Garden of Life, Pure Encapsulations and Solgar. Nestl\u00e9 said those brands highlight \u201cour capabilities in science, innovation and brand-building\u201d to \u201cgive us a distinct competitive edge.\u201d<\/p>\n The company added: \u201cOrganic growth slowed in Nestl\u00e9 Health Science, following mixed performance across business segments. In VMS, growth was impacted by the discontinuation of some private label business and weaker performance in our mainstream brands, particularly Puritan\u2019s Pride. In active nutrition, we had strong growth momentum in Orgain. In medical nutrition, solid growth was driven by pediatric products.\u201d<\/p>\n Market share was stable in both VMS and medical nutrition, with losses in active nutrition.<\/p>\n Michael Bush, managing partner at consulting firm GrowthWays Partners, told NutraIngredients that the original acquisition left some scratching their heads and that seeing Nestl\u00e9 focus on its premium\/growth brands makes significantly more sense. <\/p>\n \u201cThere appears to be a race to the bottom in the private label and commodity supplement market, so this shift in focus aligns with Nestl\u00e9\u2019s emphasis on natural and premium products,\u201d Bush said. \u201cIt will be interesting to see which assets are sold off and who will acquire them. It may make sense to split it up, as the potential buyer universe for the brands and private label\/manufacturing may be quite different.\u201d<\/p>\n Federal Trade Commission<\/p>\n