Nestle to Sell Its Jenny Craig Brand to Private Equity Firm

LONDON â€" Nestlé, the Swiss food giant, said Thursday that it has agreed to sell its Jenny Craig brand in North America and Australia, New Zealand and other parts of the Pacific to North Castle Partners, a Connecticut private-equity firm focused on health and wellness businesses.

The deal comes seven years after Nestlé spent $600 million to buy the weight-loss company from two private-equity firms. Last month, Paul Bulcke, the Swiss firm’s chief executive, said Nestlé planned to divest some of its under-performing brands.

The Jenny Craig business in France isn’t part of the transaction. Financial terms of the deal weren’t disclosed.

North Castle Partners portfolio includes Curves, Red Door Spa and several other fitness and lifestyle-focused companies.

Jenny Craig sells portion-controlled, prepackaged food and tailors weight-loss programs for consumers, offering telephone and in-store consultations for a fee.

Nestlé acquired the business in 2006 after winning a long-running auction. Jenny Craig had been put up for sale by ACI Capital and MidOcean Partners, a spinoff of Deutsche Bank’s private equity business.

The private equity firms bought a majority interest in Jenny Craig from the company’s founders, Jenny Craig and her husband, Sid, in 2002 for $115 million.

At the time, Nestlé said that it was looking to bulk up it Nestlé Nutrition unit, which includes Gerber baby food business and its Powerbar energy bar brand. Reuters has reported that Nestlé is looking to sell its Powerbar business.

The Swiss company has a large stable of brands that touch on almost every area of food, including KitKat chocolate bars, Häagen-Dazs ice cream, Nespresso coffee, Lean Cuisine frozen food and Purina dog and cat food.

In recent months, the company has begun to trim its offerings, selling Peters Ice Cream, an Australian brand, to a private equity firm in June and the Carola and Val Saint Lambert bottled water brands in France in July.

While not addressing any specific business lines, Mr. Bulcke, the Nestlé chief, said at an investor presentation on Oct. 1 that there was a short list of business lines that the company planned to focus on fixing, but some business lines could be sold.

“We are business people. We want to do business, not get rid of business,” Mr. Bulcke said. “But there are certain things that we don’t see that we can fix.”