Nestlé has entered into exclusive negotiations with a consortium led by EQT and a wholly owned subsidiary of the Abu Dhabi Investment Authority (ADIA) for the sale of Nestlé Skin Health for a value of CHF 10.2 billion. Nestlé Skin Health had net sales of CHF 2.8 billion in 2018. The proposed transaction will be subject to employee consultations and approval of regulatory authorities and is expected to close in the second half of 2019. The company will provide an update on the use of proceeds and its future capital structure at that time.
Founded in 1981 as Galderma and operating as a wholly owned subsidiary of Nestlé since 2014, Nestlé Skin Health offers a range of medical and consumer skin health solutions through three business units: aesthetics and prescription, both under the Galderma brand, and consumer health.
The consortium says it intends to support Nestlé Skin Health in its next period of growth and innovation, leveraging EQT’s long-term experience and industrial network. The strategy will build on the current direction taken by Nestlé Skin Health’s management and focuses on accelerating growth further by building on the company’s strong market position and brands.
Priorities will be to invest in commercial excellence and drive innovation in collaboration with health care professionals in the Aesthetics unit; to continue investments in R&D and business development to strengthen the prescription division and leverage its best-in-class commercial platform; and to increase presence in the US, launch new products and focus on international expansion in the consumer health business. The company will keep its headquarters in Switzerland and will be rebranded as Galderma.
The investment is in line with EQT’s thematic approach of investing with the trend in businesses with positive societal impact, advancing the progress of one or more of the United Nations Sustainable Development Goals (SDG). Nestlé Skin Health contributes to society by enhancing the quality of people’s lives and by contributing to a healthier future through science-based solutions for skin health. The consortium will support the Company to stay in the forefront of sustainability.
“We are impressed by Nestlé Skin Health’s management team and its achievement in positioning the company as a leading player across its three business units,” said Michael Bauer, Global Head of Healthcare at EQT Partners and Investment Advisor to EQT VIII and continues: “The heritage of the company as a focused skincare company with a comprehensive product portfolio, exceptionally strong brands and high customer loyalty is unique. This growth investment opportunity fits well to EQT’s DNA of driving growth and making strong companies even stronger. We look forward to supporting the management team and employees of NSH in its next phase of growth and innovation by further promoting innovative skin health products that improve health and well-being."
Hamad Shahwan Al Dhaheri, Executive Director of the Private Equities Department at ADIA, said: “NSH is a leading global business with a well-balanced portfolio of dermatology products, targeting sizeable end-markets with strong underlying growth. This proposed transaction aligns with our approach of making strategic investments alongside proven partners to help strong, innovative businesses grow.”