Nestlé’s European brands in the pizza category are spread across the bloc, operating in countries such as Germany, Italy, France, Spain, Switzerland, Portugal, Austria, Belgium and The Netherlands through the Wagner, Buitoni and Garden Gourmet brands.
The new joint venture will allow the company to develop and expand its pizza business, which will be under an (as yet unannounced) new name.
In the joint venture, Nestlé will retain a non-controlling stake and have equal voting rights with PAI. The transaction is currently subject to employee consultations and the approval of regulatory authorities, and as such, it is expected to close later this year.
The new venture will have its headquarters in Germany, and manufacturing facilities will be operated in Nonnweiler, Germany; and Benevento, Italy.
"We took a thorough look at our European pizza business and concluded that partnering with PAI provides the best platform to develop its full potential,” said Marco Settembri, Executive Vice President, Chief Executive Officer Zone Europe at Nestlé.
“Nestlé will remain invested in this business and participate in future growth and value creation as the joint venture continues to provide the very best pizza for consumers and retail partners."
Despite cost-of-living pressures, Nestlé remains optimistic about the venture. “We see long term value evolution in the category,” a spokesperson for Nestlé told FoodNavigator, “but with some short-term price pressure. There is continued opportunity for value creation going forward.”
"This transaction is testimony to our relationship with Nestlé and brings together Nestlé's iconic brands with PAI's depth of expertise in creating leaders in Food & Consumer,” said Frédéric Stévenin, one of the managing partners of PAI. “We are delighted to once again partner with Nestlé to replicate our previous success."
This joint venture comes off the back of PAI and Nestl ice cream joint venture, Froneri, in 2016.
Earlier this year, Nestlé disclosed the nutritional value of the entire global portfolio, benchmarking it against Australian and New Zealand-based voluntary front-of-pack labelling scheme Health Star Rating (HSR).
It also disclosed the value of 13 local portfolios, benchmarking them against that country’s local nutrition rating system (Nutri-Score in European countries such as France and Germany, the UK Government Nutrient Profiling Model in the UK).
“We have continuously improved the nutritional value of our portfolio, including in pizza,” the company spokesperson told us. “The [JV] decision was taken to provide the best platform to achieve the full development potential and value of our pizza business in Europe.”
The new joint venture will not be included in Nestlé’s yearly nutritional value reporting of its global portfolio.