Nestle in plan to open new nutrition unit

NESTLE, the world’s biggest food group, is setting up a new company to develop products it says will treat diseases like diabetes.

The maker of Nescafe coffee, and KitKat chocolate bars has been advancing into healthy foods to tap into growing consumer awareness of the benefits of a healthier diet.

Nestle chief executive Paul Bulcke said the market was still crystallising, with some estimating it to be worth up to $150bn (£94bn). The firm said Nestle Health Science, to be operational from 1 January 2011, will conduct research into foods that can improve health and longevity.

The parent company will invest around SwFr500m (£321m) the next decade and the new offshoot will compete with companies such as Abbott Laboratories, chairman Peter Brabeck said. It will be run at arm’s length from Nestle’s main food, beverages and nutrition activities, and will incorporate its HealthCare Nutrition unit. The HealthCare Nutrition unit had a turnover of SwFr1.6bn in 2009.

Nestle as a group is one of the world’s biggest producers of processed foods, including Nesquik drink and Haagen-Dazs ice cream, with sales of SwFr108bn last year. Luis Cantarell, currently head of operations in the Americas, will head the new company from the start of next year. Nestle chairman Peter Brabeck-Letmathe said: “Personalised health science nutrition is about finding efficient and cost effective ways to prevent and treat acute and chronic diseases in the 21st century.”

Around 285m people have diabetes, one of the major causes of premature illness and death worldwide.

Vevey-based Nestle said as a result of Cantarell’s move, Chris Johnson would join the Nestle executive board.