Bulletin: Nestle S.A. Ratings Unchanged On Announced Licensing Agreement For Starbucks' Consumer And Foodservice Products

MILAN (S&P Global Ratings) May 7, 2018--S&P Global Ratings said today that its ratings and outlook on Nestle S.A. (AA-/Stable/A-1+) are not affected by the group's announced agreement to buy the perpetual global licensing rights of Starbucks' consumer and foodservice products for about US$7.15 billion. The acquisition is consistent with the company's active portfolio management aimed to maintain organic sales growth of 2%-4% and to achieve operating profit of 17.5%-18.5% by 2020. In 2018, Nestlé has already announced the acquisition of Atrium for US$2.3 billion and the sale of its U.S. confectionary business for US$2.8 billion, and has indicated new divestitures could be completed in the coming quarters. Assuming a linear execution of the Swiss franc (CHF)20 billion 2017-2020 share

...MILAN (S&P Global Ratings) May 7, 2018--S&P Global Ratings said today that its ratings and outlook on Nestle S.A. (##-/Stable/A-1+) are not affected by the group's announced agreement to buy the perpetual global licensing rights of Starbucks' consumer and foodservice products for about US$7.15 billion. The acquisition is consistent with the company's active portfolio management aimed to maintain organic sales growth of 2%-4% and to achieve operating profit of 17.5%-18.5% by 2020. In 2018, NestlT has already announced the acquisition of Atrium for US$2.3 billion and the sale of its U.S. confectionary business for US$2.8 billion, and has indicated new divestitures could be completed in the coming quarters. Assuming a linear execution of the Swiss franc (CHF)20 billion 2017-2020 share buyback program, we estimate that our adjusted ratio of debt to EBITDA will be maintained below 2x in 2018. In the coming years, in line with the company's indication that it targets a 1.5x reported leverage...

Bulletin