Froneri has unveiled plans to expand into North America by acquiring the Nestlé USA ice cream business for $4 billion. The deal includes established cream brands including Dreyer’s, Häagen-Dazs, Outshine, Skinny Cow, Edy’s, Nestlé Ice Cream and Drumstick, which generated sales of approximately $1.8 billion in 2018.
Leeming Bar, North Yorkshire, England-headquartered Froneri, an ice cream-focused partnership created three years ago with Vevey, Switzerland-based Nestlé and Paris, France-headquartered PAI Partners, now ranks as the second largest ice cream manufacturer in the world. The US acquisition, announced on December 11, marks its entry into the American ice cream market, the largest in the world with a value of more than $10 billion per annum.
The acquisition significantly expands Froneri’s global presence, following the purchase of Tip Top Ice Cream in New Zealand in May, and Noga Ice Creams in Israel in July, which gave the company entry to those markets for the first time.
With a solid foundation of iconic brands from the 2016 merger of Nestlé’s European ice cream business in 20 countries and PAI-owned R&R, Froneri has been able to achieve rapid sales and profit growth, steadily gaining market share and achieving sales of approximately CHF 2.9 billion in 2018.
“The creation of Froneri has been a phenomenal success,” said Nestlé CEO Mark Schneider. “We are now making this business our global strategic partner in ice cream and are convinced that its successful business model can be extended to the US market. With this transaction, we are taking a decisive step towards our goal of achieving global leadership in ice cream.”
Froneri CEO Ibrahim Najafi stated: “This is another milestone acquisition for us as we drive towards becoming the world’s best ice cream company. We’re delighted to be bringing such well-loved US brands into the Froneri family. The acquisition is testament to the strength and longevity of our relationship with Nestlé. This partnership and the continued support of PAI Partners will be essential to ensuring we continue to delight consumers with innovative, high quality products in all markets.”
Frédéric Stévenin of PAI Partners added: “We are excited to bring Nestlé’s stellar US ice cream business to Froneri. This is a great opportunity for further growth, building on the expertise of the world’s leading pure-play ice cream company.”
The deal is expected to close during the first quarter of 2020, following the completion of customary regulatory approvals. Nestlé will continue to manage its remaining ice cream businesses in Canada, Latin America and Asia as part of the company’s current market structure.