The Switzerland-based food and drink processing conglomerate, Nestle has agreed to buy the main brands of the American vitamins and supplements maker the Bountiful Company for $5.75 billion as part of the firm’s plans to expand its health and nutrition business.
The world’s biggest packaged-food company has bought the Bountiful from KKR in a deal that covers the firm’s Nature’s Bounty, Solgar, Osteo Bi-Flex and Puritan’s Pride brands.
The deal which is expected to be concluded by the second half of this year did not include the sports and active nutrition brands of Bountiful including Pure Protein, Body Fortress and MET-Rx, as well as Dr.Organic and the Canadian over-the-counter business, which did not fit with the rest of Nestle Health Science business.
“This acquisition complements our existing health and nutrition portfolio in terms of brands and channels. It will establish Nestle Health Science as the industry leader in mass retail, specialty retail, eCommerce and direct-to-consumer in the US while offering significant opportunities for geographic growth.”
Nestle is paying 3.1 times the value of Bountiful’s sales for the brands, and 16.8 times their earnings prior to interest before tax, depreciation and amortization (EBITDA).
The acquired brands had sales of $1.87 billion in the year ended March 2021, with an EBITDA margin of 18.3 percent. The margin is expected to increase above the Nestle Group average once synergies are fully implemented by 2024.
The US-based global investment firm, KKR offers alternative asset management and capital markets and insurance solutions. The company aims to generate attractive investment returns by following a patient and disciplined investment approach, employing world-class people, and supporting growth in its portfolio companies and communities. It sponsors investment funds that invest in private equity, credit and real assets and has strategic partners that manage hedge funds.