PAI Partners is reportedly weighing up whether to sell its share in Froneri, its ice-cream venture with Nestlé.
The private-equity firm is in the ‘early stages’ of assessing options for the disposal of its interest in Froneri, according to Bloomberg, which cited people familiar with the proceedings.
Those same sources, who requested not to be named, suggested PAI Partners may opt to sell its share in the second half of the year and at the same time put the stake up for an initial public offering. They added Nestlé is expected to retain its interest in Froneri.
The venture is split equally 50-50, with the news agency’s sources putting a $10bn valuation on PAI Partners portion.
Both PAI Partners and Nestlé declined to comment when contacted by Just Food.
UK-based Froneri was set up in 2016 when Nestlé merged its European ice-cream operations with R&R Ice Cream, another UK business owned by PAI Partners.
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The Froneri transaction combined Nestlé’s and R&R’s ice cream operations in Europe, the Middle East, Argentina, Australia, Brazil, the Philippines and South Africa. While the US and Israel were not included in 2016, three years later the latter was also pulled under the Froneri umbrella.
Nestlé then sold its US ice-cream operations the same year – 2019 – to Froneri.
The world’s largest food company retained its ice-cream business in Canada, Latin America and Asia.
Nestlé reports its own ice-cream sales within the ice cream and milk products segment, in which total sales amounted to SFr11.3bn ($13.2bn) in the 2022 financial year, representing 12% of total group sales.
Ice cream generated SFr930m, up 8.2% from a year earlier, according to the company’s annual report for that year.
Issuing its third-quarter and year-to-date results in October, Nestlé reported sales within ice cream and milk products of SFr8.1bn, down a tad from SFr8.3bn in the corresponding period.