Nestle Increases Its Share of Global Ice Cream
Bloomberg reports that Nestle SA has agreed to take control of Dreyer’s Grand Ice Cream Inc. by combining its U.S. ice cream business with the U.S. market leader in a transaction worth about $2.4 billion.
Nestle will raise its stake in Dreyer’s to 67 percent from 23 percent by merging its Haagen-Dazs and other brands in the U.S. with Dreyer’s business in exchange for 55 million shares, according to Nestle Spokesman Francois-Xavier Perroud.
The maker of Edy’s ice cream is Nestle’s third addition in the fast-growing frozen treats business in six months. Gaining control of Dreyer’s will give the Swiss company about 17 percent of the $25 billion global ice cream market, roughly equal to global leader Unilever, the company says. Dreyer’s Chairman T. Gary Rogers will lead the combined businesses.
Moderator Comment: What impact will the Nestle/Dreyer’s
deal have on the ice cream and frozen novelty market?
Clearly, this deal signals the intention of putting the
combined Nestle/Dreyer’s entity into a position to go after the market share
held by Good Humor/Breyers. It could also signal problems ahead for local and
regional ice cream suppliers as a stronger Nestle/Dreyer’s commands more freezer
case space. [George
Anderson – Moderator]