Strategic Sale, Not a Full Exit
Unlike the 2021 divestiture, this move won’t be a clean break. Nestlé reportedly plans to retain a minority stake in the water unit, hedging its bet on a potentially lucrative but turbulent sector.
“The main struggle is at Perrier,” noted Vontobel analyst Jean-Philippe Bertschy, highlighting operational and compliance challenges. “They’ve had issues at several sources, and there’s an ongoing battle with French authorities.”
Still, most of the water brands remain profitable, with the division posting a 2.9% revenue uptick in Q1, reaching 722 million Swiss francs ($874 million), though that accounts for less than 4% of Nestlé’s total earnings.
Legal Waters and Bottled Pressure
Nestlé’s water operations in France have faced regulatory challenges, prompting reviews of its mineral water sourcing practices. Though the company has asserted that its products are safe and its production currently complies with French law, past lapses in regulatory adherence at certain sites have cast shadows over the division.
Sanjay Bahadur, head of Nestlé’s global strategy, acknowledged last November that private equity and strategic buyers have eyed the water unit for decades. That interest has only intensified as the company formalizes the sale process.
