Nestle Wants to Be Cause and Solution
Tuesday, June 20, 2006
GENEVA, June 19 -- In a move that recognizes the modern world's twin obsessions -- indulgence and guilt -- chocolate maker Nestle SA said Monday that it would purchase weight-loss-product maker Jenny Craig Inc. for $600 million.
While best known for its namesake chocolates, Nestle also makes baby formulas, nutrition foods such as PowerBar and the Lean Cuisine line. The Swiss company's purchase of Jenny Craig follows the lead of consumer products giant Unilever, which bought both Ben & Jerry's ice cream and Slim-Fast in 2000.
Weight management will become a new business within Nestle's nutrition unit and will reinforce its U.S. presence, the company said.
"With this strategic acquisition, the group takes another important step in its transformation process into a nutrition, health and wellness company," said Nestle chief executive Peter Brabeck-Letmathe.
Nestle is buying Jenny Craig from two private equity groups, ACI Capital Co. and MidOcean Partners. The management team of Jenny Craig, based in Carlsbad, Calif., will continue to run the business and will report directly to Nestle.
Jenny Craig, which has more than 3,000 employees and more than 600 centers in the United States, Canada, Australia and New Zealand, generated sales of more than $400 million in the past 12 months.