Nestlé has signed an agreement to sell 24.85% of its Alcon shares to Novartis for approximately US$11bn.

The divesture is part of Nestlé's strategy to focus on nutrition, health and wellness.

The cash transaction, concerning 74m Alcon shares at $143.17 each, means Nestlé will retain close to 52% of Alcon's issued share capital and continue to fully consolidate Alcon.

The proceeds of the transaction will be used by Nestlé to reduce debt as the company pursues its on-going share buy-back program. In addition, they will support opportunities for profitable growth in line with the group's nutrition, health and wellness orientation.

"Today's decision reflects Nestlé's commitment to ensure a strategically sound and financially attractive solution for Nestlé and Alcon," said Peter Brabeck-Letmathe, chairman and CEO of Nestlé. "Nestlé has been able to take a further step in realizing shareholder value from its long-term Alcon investment."

The transaction will have a positive effect on reported earnings per share (EPS) in 2008 and is subject to regulatory review, the company said.

Nestlé expects the sale process to be completed before the autumn of 2008.