Nestle To Buy Kraft Foods Frozen Pizza Business

Strengthens its position in the frozen pizza category, where it had a minor presence until now

Nestle has agreed to acquire Kraft Foods' frozen pizza business in the US and Canada for $3.7bn in cash. The business includes brands such as DiGiorno, Tombstone, California Pizza Kitchen, Jack’s and Delissio.

The business will be part of Nestle US. The transaction is subject to US and Canadian regulatory approval and is expected to be completed in 2010.

According to the company, this frozen pizza business provides a new strategic pillar to its frozen food portfolio in the US and Canada, where it already exists in domain of prepared dishes and hand-held product categories under the Stouffer's, Lean Cuisine, Buitoni, Hot Pockets and Lean Pockets brands.

Nestle said that the acquisition strengthens its position in the frozen pizza category, where it only had a minor presence until now, and builds on its existing pizza capabilities and operations in Europe.

Paul Bulcke, CEO of Nestle, said: This frozen pizza business greatly enhances Nestle's frozen food activities in North America, bringing together a selection of great US and Canadian brands, industry-leading R&D and excellent route-to-market capabilities, which complement our existing ice cream direct-store-delivery. With total sales of around CHF3 billion, Nestle will become the world leader in the attractive, fast-growing frozen pizza category.

Brad Alford, chairman and CEO of Nestle US, said: Our combined capabilities in direct-store-delivery, R&D, innovation and commitment to quality, taste and convenience make this a good strategic fit with our frozen food portfolio.