Nestlé Health Sciences Acquires Majority Stake in Vital Proteins

By: Christopher Shim (University of Cambridge), Jonathan Fuchs, Chiara Fulvi (London School of Economics), Varshika Prasanna, Aman Singla (New York University)

 

Overview of the deal


Acquirer: Nestlé Health Science S.A.

Target: Vital Proteins LLC

Implied Equity Value: Offer Price not disclosed

Total Transaction Size: USD 700m - 800m (Sources told Mergermarket)

Announced date: 10.07.2020

Target advisor: UBS


Nestlé’s nutritional science subsidiary, Nestlé Health Science (NHSc) has entered into an agreement to buy a majority stake in Vital Proteins, a leading U.S. producer of collagen-based supplements. Amidst the pandemic, Vital Proteins has seen demand for its products grow by more than 50% as consumers became more focused on their health. Nestle is hoping that the investment in the lifestyle brand will import a loyal customer base and products that complement its current palette of vitamins, minerals and supplements, hence presenting promising cross-selling opportunities. After the investment, Vital Proteins will continue to operate as a separate entity to maintain its high levels of innovation. Nestlé is planning to help Vital Proteins expand geographically and extend its product portfolio of 150 SKUs which are currently sold across 35,000 retailers in the U.S. and Europe.


“The collagen nutrition market is growing, and Vital Proteins has shown its strength by becoming a full lifestyle brand which will perfectly complement our other vitamin, mineral and supplement brands.” — Greg Behar, CEO of NHSc

Company Details: Nestlé Health Sciences


Founded in year, headquartered in City, State/Country

CEO: Ulf Mark Schneider

Number of employees: 291,000

Market Cap: $ 283B (as of 28/08/2020)

EV: $ 318B

LTM Revenue: $82.6B

LTM EBITDA: $40.6B

LTM EV/Revenue: x4.01

LTM EV/EBITDA: x18.22


Company Details: Vital Proteins

Founded in year, headquartered in City, State/Country

CEO: Kurt Seidensticker

Number of employees: 200-500