Nestlé to buy Pfizer unit for $11.85bn Nestlé is to acquire the nutrition business of Pfizer, sealing a bidding battle with a cash offer of $11.85bn. The Swiss food conglomerate beat rivals including Danone of France to win the auction triggered by Pfizer's decision to refocus on its core pharmaceuticals business. The nutrition business reported revenues of $2.1bn last year, up 15 per cent from 2010. It sells speciality infant and toddler formulas, follow-on formulas, as well as maternal and adult nutrition products. Paul Bulcke, chief executive of Nestlé, said: "Infant nutrition has been at the heart of our company since it was founded in 1866. Pfizer Nutrition is an excellent strategic fit and this acquisition underlines our commitment to be the world's leading nutrition, health and wellness company. The sale will be Pfizer's largest divestiture since the $16.6bn sale of consumer health brands including Sudafed cold medicine and Bengay pain cream to Johnson & Johnson in 2006. Pfizer gained the formula division through its $68bn purchase of Wyeth in 2009. Ian Read, Pfizer's chairman and chief executive, who decided on the sale after his appointment at the end of 2010, said in a statement: "The sale of the nutrition business to Nestlé is consistent with Pfizer's intention to generate the greatest value for shareholders by maximising the value-creation potential of our businesses and prudently managing our capital allocation. We remain focused on enhancing shareholder value and, following the completion of this divestiture, we expect to allocate the after-tax proceeds to further share repurchases, or invest in other business development opportunities, with the return on share repurchases remaining our case to beat. Pfizer said it would update its 2012 financial guidance when it reports its first-quarter 2012 financial results on May 1 this year. It said it expected the divestiture to be completed by the first half of 2013, subject to regulatory clearances and other closing conditions. Amy Schulman, general manager of Pfizer Nutrition, said in a statement: "The combination of Nestlé and Pfizer's Nutrition business, with its leading position in emerging markets, portfolio and science, will continue to serve the needs of formula-fed infants and their healthcare professionals and caregivers." Pfizer was advised by Morgan Stanley and Centerview, and its lawyers were Skadden, Arps, Slate, Meagher & Flom, Clifford Chance and DLA Piper.