Nestlé to Sell Ice Cream Business to Froneri, D’Onofrio’s Future in Peru Uncertain
Nestlé is streamlining its portfolio, agreeing to sell its remaining global ice cream businesses to Froneri, its joint venture with PAI Partners. The move, announced on , reflects a broader trend among major consumer packaged goods companies to focus on core brands and improve profitability. The deal includes operations in Canada, Chile, Peru, Malaysia, China and Thailand, representing nearly CHF 1 billion in annual revenue.
The decision to divest the ice cream business comes under the leadership of Nestlé’s new CEO, Philipp Navratil, who has signaled a commitment to a more focused strategy centered around coffee, petcare, nutrition, and food and snacks. Navratil described the ice cream division as a “distraction” for the company, particularly as it executes a cost savings program. “This business is a great fit for Froneri and we have agreed to sell [it] in a phased way,” he told investors.
Nestlé initially formed Froneri in as a 50:50 joint venture with private equity firm PAI Partners, combining their respective ice cream businesses across Europe, the Americas, Southeast Asia, and South Africa. In , the company further consolidated its ice cream holdings by selling its U.S. Division, including the Häagen-Dazs and Dreyer’s brands, to Froneri for $4 billion. Nestlé maintains a 50% stake in Froneri and has no plans to exit the venture, citing its strong performance.
The sale is part of a wider effort by Nestlé to reshape its portfolio and address recent financial headwinds. The company reported a 17% decline in global profits last year, and its stock price has fallen to an eight-year low. Beyond ice cream, Nestlé is also exploring options for its vitamin business and seeking a partner for its water portfolio, which includes brands like Sanpellegrino and Perrier. This mirrors a similar strategy adopted by Unilever, which recently spun out its ice cream business to unlock innovation and focus on other areas.
The impact of the sale is particularly noteworthy in Peru, where Nestlé’s D’Onofrio brand holds an estimated 88% market share. The company is currently “evaluating details” regarding the future of its Peruvian ice cream operations, according to a recent statement, and will provide further information “in due course.” D’Onofrio, acquired by Nestlé in , is a deeply ingrained brand in the Peruvian market, known for its iconic yellow carts and popular flavors like Peziduri, Sublime, and Donito.
Despite the potential sale, Nestlé Peru has been actively investing in its ice cream business, with approximately $10 million allocated to infrastructure improvements, eco-friendly freezers, and logistical enhancements in recent years. The company recently launched several innovative products, including ice cream flavors based on its Nescafé coffee and a KitKat-flavored ice cream with a layered texture, initially introduced in Peru. Andrea Arllentar, Nestlé Peru’s Marketing Manager for Ice Cream, highlighted the positive performance of the summer campaign and expressed optimism about double-digit growth for the season.
Nestlé Peru also operates Antica Gelatería del Corso, a chain of gelaterias that entered the Peruvian market several years ago. The company plans to continue investing in and expanding this brand, focusing on quality and customer experience. Arllentar noted that the Peruvian ice cream market is evolving, with increasing competition and a more discerning consumer base seeking indulgence, convenience, and brands that align with their values.
Per capita ice cream consumption in Peru has risen significantly in recent decades, from 0.87 liters in the 1990s to approximately 2 liters today. This growth reflects increasing disposable incomes and a growing demand for frozen desserts. While the market is becoming more competitive, D’Onofrio remains the dominant player, with a substantial market share and a strong brand reputation.
The sale of Nestlé’s remaining ice cream assets to Froneri represents a strategic shift for the global food giant, signaling a renewed focus on core businesses and a willingness to streamline its portfolio to drive growth and profitability. The move is likely to have a significant impact on the ice cream industry, potentially leading to further consolidation and innovation as Froneri expands its global footprint.