Nestlé confirms plan to purchase The Bountiful Co. in deal in $5 billion range

By Hank Schultz contact

- Last updated on GMT

©Getty Images - Kritchanut
©Getty Images - Kritchanut

Related tags: Mergers and acquisitions

Swiss nutrition giant Nestlé has reportedly confirmed that it will acquire The Bountiful Co. prior to a planned initial public offering for the maker of Nature’s Bounty supplements.

The Bountiful Co. is what Nature’s Bounty Inc. renamed itself in January 2020. The company has also formerly been known as NBTY.  In mid April the company had filed paperwork with the US Securities and Exchange Commission for an inital public offering, which was originally planned to raise $100 million worth of shares as a placeholder value.

Bountiful, which is majority owned by prominent private equity firm KKR & Co., was planning a launch under the stock ticker BTFL.  

Riding the pandemic wave

While other parts of the economy are slowing digging out from the financial fallout of the global pandemic, times for many categories of the dietary supplement industry have never been batter.

As part of the filing, Bountiful reported that it had earned $54.3 million in the three months that ended in December, 2020.  That compared to $6.9 million in the same period in 2019, as Bountiful participated in the huge boom in the sales of many supplement categories during the global pandemic, including any that could boast an immune health tie in.

The company further reported as part of the IPO paperwork that gross sales in trailing 15 months, or the October 2019 to December 2020 time period, hit $629.4 million, compared to $429.8 million in a similar period a year previously.

The Wall Street Journal ​reported on Friday that Nestlé is finalizing a bid for Bountiful that could amount to the ‘mid digits’ of billions of US dollars.  The IPO filing reportedly pegged Bountiful’s public market value at as much as $6 billion.

In addition to the Nature’s Bounty line of products, the Bountiful also features Pure Protein, which makes protein bars, Osteo Bi-Flex joint-care supplements and Puritan’s Pride vitamins and supplements.

In the IPO filing, KKR billed Bountiful as the largest pure-play nutrition company in North America and one of three largest in the world. 

WSJ: Nestlê not done with acquistions

The WSJ​ report noted that Nestlé ended 2020 with about $9.4 billion in cash (8.6 billion CHF) on hand, and a market value of almost $340 billion meaning the Swiss firm has ample financial wherewithal to fund the Bountiful deal along with other health and wellness acquisitions the company is reportedly contemplating.

Bountiful, during the time when it flew the NBTY flag, made news when the company was among several prominent firms attacked by then New York Attorney General Eric Schneiderman​.  The NYAG action alleged that product testing had shown little to none of the listed bioactives within the bottles of selected supplements.  Critics of the move claimed the test results rested on a misapplication of DNA barcoding technology.  Bountiful said at the time that it was “confident our products meet label claims.”

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