Novartis sells nutrition unit to Nestle for $2.52B

Drug major Novartis has signed a definitive agreement to divest its Medical Nutrition business unit to fellow Switzerland-based food and beverage giant Nestle SA for $2.52 billion. This transaction, which requires customary regulatory approvals, is expected to be completed in the second half of 2007.

"Following our long-term strategy, this divestment continues to enhance our focus on health care, further strengthens our financial position and provides strategic flexibility," said Novartis chief executive Daniel Vasella. "We also believe that this transaction offers the ideal fit for the Medical Nutrition business and the best opportunities for Medical Nutrition associates and management," he added.

According to Novartis, the sold unit is the number two global supplier of enteral nutrition, oral nutrition and medical devices used to provide essential nutrients to patients with special medical conditions. These products are often required when illness or disabilities limit the ability of patients to eat a balanced diet.