Nestlé to become a world leader in pet food production

Nestlé has confirmed it is to buy Ralston Purina swissinfo.ch

The Swiss-based food giant, Nestlé, confirmed on Tuesday it is taking over the United States pet-food company, Ralston Purina, in a deal worth $10 billion (SFr16.3 billion).

The move – also confirmed by the US company- will make Nestlé one of the world’s largest pet food producers.

In a statement from its headquarters in Vevey, Nestlé said it would pay $33.50 per share in cash.

Analysts say a deal could raise anti-trust questions, forcing Nestlé to divest itself of some brands to win US regulatory approval.

The Wall Street Journal, which disclosed the impending deal on Monday, said Ralston currently holds a 27 per cent share of the US’s $4.3 billion dog-food market, compared to Nestlé’s 12 per cent share.

The two firms together account for 46 per cent of the cat-food market, with Ralston commanding 33 per cent.

Analysts say Nestlé is keen to expand in the pet-food market, as it is one of the strongest growing segments in the food industry. Sales in the US grew by nearly five per cent last year.

swissinfo