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Deutsche Bank Lines Up Around €2.9B Loan-Only Debt Package for 50% Stake Buyout in Nestle’s Water Unit; First-Round Bids Due March 10
Deutsche Bank is lining up an indicative financing package at 5.75x leverage for potential buyers of the 50% stake in Swiss multinational food and beverage company Nestle’s water unit, according to sources.
The staple financing is a loan-only debt package that is expected to be evenly-split in euros and U.S. dollars given the underlying business is international, the sources said.
The leverage indicates a total debt size of around €2.9 billion as the water unit is marketed off an EBITDA of roughly €500 million, as reported.
First-round bids for the stake sale is due today, March 10, with interested buyers including private equity firms Apollo, Butterfly, CD&R, KKR and PAI, according to sources.
Deutsche Bank and Rothschild are the sell-side advisors on the auction process.
If the stake sale completes, the structure will likely resemble that of PAI’s joint venture with Nestle for Froneri, which was formed in 2016 through the merger of PAI’s R&R Ice Cream with Nestle’s European ice cream business. PAI transferred its own stake in Froneri into a continuation vehicle last year and simultaneously raised €4.5 billion of new debt to fund the transfer and allow shareholders to take out a dividend, as reported.
Nestle announced on its capital markets day in November 2024 that the water and premium beverages activities will become a global standalone business under the leadership of Muriel Lienau, head of Nestle Waters Europe, as of Jan. 1, 2025.
The division includes water and soft drink brands such as San Pellegrino, Perrier and Acqua Panna.
Apollo, Butterfly, CD&R, Deutsche Bank, KKR and PAI declined to comment.
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