Nestle, Danone in lead for Pfizer's $10-bn Wyeth baby nutrition business

Nestle SA, the world's largest food company and French dairy major Groupe Danone (BN) SA have emerged as prime contenders to buy Pfizer's $10 billion infant nutrition business.

 
Along with the European giants, US-based Mead Johnson and Heinz have also entered the second round of auction for the world's second-largest infant nutrition business.
 
Pfizer acquired the infant-nutrition division in its $68 billion takeover of Wyeth in 2009, and since early July 2011 has been exploring alternative options, including, a full or partial spin-off or sale of its Nutrition and Animal Health business, in order to focus on its core biopharmaceutical products.

Pfizer had hired Morgan Stanley and Centerview Partners to evaluate the businesses and complete any transactions in 12 to 24 months.

Pfizer Nutrition is the second-largest in the world after Nestle. It is a leader in infant and paediatric nutrition with core brands that include SMA Gold, Promil Gold, Progess Gold, and S-26 Promise Gold. The business also produces vitamins for pregnant women, and generated revenues of $1.9 billion in 2010 and $2.1 billion in 2011.
 
Pfizer Nutrition business is growing at 8 per cent a year with around 60 percent of sales coming from Asia, a third of it from China, while 30 and 10 per cent comes from Europe and Latin America respectively.

It is the world's fifth-largest in the infant milk formula market behind Nestle, Mead Johnson, Danone and Abbott Laboratories.

Pfizer Nutrition operates in six continents and its products are available in more than 60 countries. Its main markets are Asia, the Middle East, Europe and Latin America, with China, Philippines, the UK, Mexico and Australia being its key markets.