IPO of med­i­cal-nu­tri­tion business on cards

The Star Early Edition - - COMPANIES -

DANONE, the world’s big­gest yo­gurt maker, was con­sid­er­ing an ini­tial pub­lic of­fer­ing (IPO) of its med­i­cal-nu­tri­tion business after strug­gling to get the price it wanted in a sale, said peo­ple with knowl­edge of the mat­ter. The company was pre­par­ing a pos­si­ble stock mar­ket list­ing next year even as it still dis­cussed a sale, the peo­ple said, ask­ing not to be named be­cause the de­tails are not pub­lic. Danone had so far failed to reach an agree­ment after hold­ing talks with Fre­se­nius and buy­out firms, as well as Hospira and Nes­tle, the peo­ple said. The unit, whose prod­ucts in­clude mal­nu­tri­tion sup­ple­ment For­timel, could be val­ued at more than € 3 bil­lion (R41.6bn), peo­ple fa­mil­iar with the mat­ter have said. Com­pa­nies of­ten pur­sue both a sale and an IPO at the same time to get the best value on an as­set. Own­ers of com­pa­nies in­clud­ing Span­ish cable op­er­a­tor Grupo Cor­po­ra­tivo Ono and UK road­side as­sis­tance business RAC, pur­sued list­ings be­fore be­ing ac­quired this year. Sell­ing the unit may help Danone buy big­ger as­sets as it seeks to re­duce the sig­nif­i­cance of its dairy di­vi­sion. The French company’s man­age­ment dis­cussed po­ten­tial ac­qui­si­tions in­clud­ing US baby food maker Mead John­son Nu­tri­tion at a board meet­ing last month. – Bloomberg

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