The 2016 deal merged R&R, owned by PAI, and Nestlé’s European ice cream business in 20 countries. It made Froneri one of the world’s largest ice cream companies, and the new deal gives it a strong, untapped presence in the US.
Froneri has spoken about its goals to ‘build the world’s best ice cream company’ in both retail and out-of-home channels. It said that acquisitions are important growth drivers in the business to further scale.
Mark Schneider, CEO of Nestlé, said, "The creation of Froneri has been a phenomenal success. We are now making this business our global strategic partner in ice cream and are convinced that Froneri’s 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."
Operations in Europe, Latin America, Africa and Asia-Pacific gave Froneri a turnover of about USD $2.95bn in 2018. In the same time frame, Nestlé USA’s turnover was about USD $1.8bn. Froneri will acquire leading dessert brands like Häagen-Dazs, Drumstick, Dreyer’s, Skinny Cow, Edy’s, Nestlé Ice Cream and Outshine.
Nestlé USA is the second largest ice cream manufacturer in the US, and Froneri will now be the second largest ice cream manufacturer in the world. The US ice cream market is the biggest in the world, worth more than $10bn every year.
Ibrahim Najafi, Froneri CEO, said, "This is another milestone acquisition for Froneri 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."
The management team at Nestlé USA will be integral to the transition, which will include marketing, manufacturing, sales and distribution, and 2,300 employees across the US. Nestlé will continue to manage its remaining ice cream businesses in Canada, Latin America and Asia.
This year Froneri also acquired Nestlé’s ice cream business in Israel, and TipTop in New Zealand. Mayer Brown advised Nestlé USA on the new agreement, which is expected to close in the first quarter of 2020.
Frédéric Stévenin, Partner at PAI Partners, said, "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.”