Following the sale of its ice cream business in the U.S., including Hagen Dazs, about seven years ago, it seems that it is trying to get out of the remaining ice cream business. According to CNN and other foreign media, Nestle said it is in “deep negotiations” to sell its remaining ice cream business to its joint venture partner, Froneri. Nestle has six ice cream brands, including Hagen Dazs, Drumstick, and Möbenpick.
Proneri is a joint venture founded in 2016 by Nestle with European private equity firm PAI Partners in a 50-50 stake. Nestle sold its ice cream business in the U.S. for $4 billion Proneri in 2019.
The sale of the ice cream business is being pursued by Nestle’s new CEO Philippe Navratil during a re-examination of the entire company’s business structure. Navratil was hired to overcome years of poor performance after his predecessor, CEO Laurent Freix, was dismissed due to in-house problems. He also underwent a restructuring of 16,000 people shortly after taking office in September last year.
Nestle said in its full-year earnings call that it will focus on four core businesses: coffee, pet food, nutrition, food and snacks. “We are focusing our portfolio on four businesses around the most powerful brands,” Navratil said in a statement.
Nestle is trying to reduce its ice cream business because of the peculiarity of its business operation. Ice cream has a large demand fluctuation depending on the season and has to be distributed in a frozen state, which is expensive to build and maintain a supply chain.
“Nestle is not the first large consumer goods company to clean up its ice cream business, which faces challenges such as seasonal demand fluctuations and the establishment of a supply chain for frozen products,” CNN said, referring to the Unilever case. Nestle rival Unilever formed Magnum Ice Cream late last year by separating its ice cream division. Magnum owns brands such as Ben & Geris and Cornetto.
According to Reuters, Nestle’s ice cream business currently generates about 1 billion Swiss francs in annual sales in Canada, Chile, Peru, Malaysia, China and Thailand. “Sometimes you have to pull out of the business for concentration,” Navratil said of the ice cream business, “but it’s solid, it’s small and it’s not a strategic priority for us.”
Moreover, Nestle is in a situation where it has to focus on risk management due to the recent recall of baby formula. Last month, Nestle recalled some baby formula products sold in dozens of countries, including France and the United Kingdom, after a toxic substance called cerulide was detected in a product sample taken in December 2025.
SALLY LEE
US ASIA JOURNAL
