Novartis AG, Europe's third-largest drugmaker, agreed to sell its medical nutrition unit to Nestle SA for €1.88 billion ($2.5 billion) to focus on medicines and vaccines.
The transaction should be completed in the H2 of next year, Novartis, the Basel, Switzerland-based company said in an e-mailed statement. The unit makes nutritional supplements used in hospitals and generates annual sales of about €715.8 million ($950 million).
„This divestment continues to enhance our focus on healthcare, further strengthens our financial position and provides strategic flexibility,” CEO Daniel Vasella said in the statement. Novartis sold its nutrition unit, which makes Isostar energy drinks, to ABN Amro Holding NV for €204 million ($271 million) in March. Another food division, known for the malt drink Ovaltine, was sold to Associated British Foods Plc at the end of 2002 for 398.6 million Swiss francs (€248.6 million). (Bloomberg)