Nestlé has formally launched the sale of a stake in its water business, setting in motion one of the largest consumer carve-outs to hit the European private equity market, Bloomberg reports.

The Swiss food group is seeking first-round bids this month for the unit, which houses brands including Perrier and S.Pellegrino. The business is valued at about €5bn, according to people familiar with the matter, and Nestlé is working with Rothschild on the process.

Buyout firms including PAI Partners, Blackstone, KKR, Bain Capital, and Clayton Dubilier & Rice have previously expressed interest in the asset. Lenders are preparing between €2bn and €3bn of acquisition financing, expected to be split between euro- and dollar-denominated leveraged loans.

The proposed debt package would equate to roughly four to six times EBITDA, with the water unit generating about €500m in earnings. Deliberations over the size and timing of the sale remain ongoing.

Nestlé announced plans in late 2024 to separate the water division, a move revived following a leadership transition that saw Philipp Navratil appointed chief executive last September. Bankers describe the business as a high-quality asset with premium brands, though investors are expected to weigh environmental concerns and reputational issues linked to bottled water.

The sale adds to a growing pipeline of large private equity deals as improved market sentiment and abundant dry powder encourage sponsors to pursue complex carve-outs.

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