VEVEY, Switzerland -- Nestle S.A., the Swiss food multinational, has 'high hopes' that its $2.4 billion takeover bid for France's Perrier mineral water will succeed within a month, executives at company headquarters said Tuesday.
The bid was announced in Paris Monday by Nestle Executive Vice President Reto Domeniconi. Nestle, in collaboration with the French finance group Indosuez, is bidding for 100 percent of the shares of Source Perrier.
'The French authorities have a month to decide on our bid, but we are hopeful that both they and the European Community will be favorable, ' a spokesman at Nestle headquarters said Tuesday.
Nestle is bidding 1,475 French francs ($268) a share; before the takeover bid was announced, the Perrier shares were trading on the Paris Bourse at 1,200 French francs ($218). Nestle is working with Banque Indosuez, a merchant bank subsidiary of Compagnie Financiere de Suez, in its attempt to acquire Source Perrier.
The bid is in direct competition with a similar bid from Italy's Agnelli Group. The Agnelli family's investment company moved to acquire Exor S.A., a holding company with a controlling stake in Perrier, in December. The Agnelli group controls the Fiat automobile company.
If the Nestle bid is succesful, the company would sell Volvic, Source Perrier's existing mineral water operation in France, to the French group BSN, according to sources here.
Although a Nestle-Perrier linkup would give the company 25 percent of the European market for bottled water, the percentage would be over 50 percent in France unless Volvic was disposed of, sources at Nestle pointed out.
The agreement to sell the Volvic business to BSN was made to avoid ECobjections to the Nestle takeover of Source Perrier, which would make it a dominate force in the market.
In addition to Volvic, Source Perrier also produces home-delivered spring water in the United States, including Poland Spring and Arrowhead, and owns Roquefort cheese. The company's best-known product, Perrier sparkling water, was adversely affected by the finding of benzene contamination in some bottles of the beverage in 1990.
