Nestlé, the world's biggest food group, is closing in on a deal to buy Pfizer's baby food business for up to $10bn (£6bn) to boost its business in China and extend its lead in the world of formula milk.
The Pfizer business, with its SMA Gold brand, ranks as the world number five in the infant milk formula market – the world's fastest growing packaged food category – after Nestlé, Mead Johnson, Danone and Abbott Laboratories.
Sales are growing at 8 per cent a year and it has some 60 per cent of its revenue in Asia, 30 per cent in Europe – largely Britain – and some 10 per cent in Latin America.
The Swiss group had already been seen as favourite to buy the business, and is now expected to seal a deal later this month after outbidding a joint team of Danone and Mead Johnson. The deal is believed to be worth between $9bn and $10bn.
Pfizer put the business up for sale last July following its $68bn purchase of Wyeth in 2009. It is also looking to offload its animal health business and says this is more likely to be spun off than sold outright.