Ferrero Group’s $2.8 billion acquisition of Nestlé’s U.S. confectionary business.

Credit Suisse Securities, Davis Polk and Wardwell LLP and Lazard served as advisors to Ferrero. Mayer Brown served as advisors to Nestlé.

The Ferrero Group and its affiliated companies (“Ferrero”), a global confectionary group, today announced a definitive agreement pursuant to which it will acquire the U.S. confectionary business from Nestlé for $2.8 billion in cash. Nestlé’s U.S. confectionary business generated sales of approximately $900 million in 2016.

Ferrero will acquire more than 20 American brands with a rich heritage and strong awareness, including iconic chocolate brands such as Butterfinger®, BabyRuth®, 100Grand®, Raisinets®, Wonka® and the exclusive right to the Crunch® brand for confectionary and certain categories in the U.S., as well as sugar brands such as SweeTarts®, LaffyTaffy®, and Nerds®.

With this transaction, Ferrero will become the third-largest confectionary company in the U.S. market where it is best known for Tic Tac® breath mints, Ferrero Rocher® pralines, Nutella® hazelnut spreads, the Fannie May and Harry London chocolate brands, and the Ferrara Candy Company, which was recently acquired by a Ferrero affiliated company and whose portfolio of brands includes Trolli®, Brach’s® and Black Forest® Gummies.

Ferrero will acquire Nestlé’s U.S. manufacturing facilities in Bloomington, Franklin Park and Itasca, Illinois, and the confectionary-related employees, and will continue to operate through the offices in Glendale, California, as well as from its other current locations in Illinois and in New Jersey.

The transaction is subject to customary closing conditions and regulatory approvals and is expected to close around the end of the first quarter of 2018.

The Davis Polk corporate team includes partners John A. Bick (Picture) and Daniel Brass and associate Abraham Einhorn. Partner Pritesh P. Shah, counsel David R. Bauer and associate Paul S. Lee are providing intellectual property and technology advice. Partner David H. Schnabel and associate Isaac MacDonald are providing tax advice. Partner Jean M. McLoughlin and counsel David Mollo-Christensen are providing executive compensation advice.

Mayer Brown advised Nestlé SA with a team including David Carpenter and John Boelter (Picture) and Richard Assmus (Intellectual Property)

 

Involved fees earner: David Carpenter – Mayer & Brown; John Boelter – Mayer & Brown; Richard Assmus – Mayer & Brown; John Bick – Davis Polk & Wardwell; Daniel Brass – Davis Polk & Wardwell; Abraham Einhorn – Davis Polk & Wardwell; Pritesh P. Shah – Davis Polk & Wardwell; David Bauer – Davis Polk & Wardwell; Paul Lee – Davis Polk & Wardwell; David Schnabel – Davis Polk & Wardwell; Isaac MacDonald – Davis Polk & Wardwell; Jean M. McLoughlin – Davis Polk & Wardwell; David Mollo-Christensen – Davis Polk & Wardwell;

Law Firms: Mayer & Brown; Davis Polk & Wardwell;

Clients: Ferrero; Nestlè;

 

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