Nestlé S.A. will enter the weight-loss arena when it buys Jenny Craig for $600 million.
The acquisition reinforces Nestlé’s presence in nutrition, especially in the U.S., and adds weight management as a fourth pillar to its autonomous Nestlé Nutrition division. Its other businesses—infant nutrition, healthcare nutrition and performance nutrition—are stronger outside the U.S.
Since the U.S. is the world’s biggest weight-management marketplace, Jenny Craig can help expand Nestlé Nutrition’s footprint here quickly. The 23-year-old brand hit sales of $400 million over the last year, with double-digit organic growth.
Nestlé plans to keep Carlsbad, CA-based Jenny Craig’s current management intact to run the chain of 640 weight-loss centers and packaged foods business (with about 75 SKUs). It’s unclear yet how the ownership change might affect agency assignments for Jenny Craig. Current advertising stars actress Kirstie Alley as Jenny Craig’s spokesperson; its “Have You Called Jenny Yet?” campaign won a Gold EFFIE Award for best recruitment advertising earlier this month. JWT handles.
Vivey, Switzerland-based Nestlé earlier this year began acquiring business to building out its nutrition division, when it bought Uncle Toby’s cereals and nutritional snacks in Australia.
With the addition of Jenny Craig, Nestlé Nutrition “takes another important step in its transformation process into a nutrition, health and wellness company that sees weight management as a key competence,” said Nestle Chairman-CEO Peter Brabeck-Letmathe in a statement. “The rise of obesity and the resulting metabolic disorders, such as diabetes and cardiovascular disease, is a major public health concern, not only in the U.S. but also the world over. The Jenny Craig acquisition puts us in a privileged position to help many of our consumers.”
Jenny Craig is privately held by an investor group led by ACI Capital Co., Inc. and MidOcean Capital Partners, Inc. Founders Sid and Jenny Craig hold a 20% stake in the company.
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