People familiar with the negotiations said both parties are working to finalise terms for the sale of about half of the business before Nestlé releases its half-year trading update on Thursday. The proposed deal would see the water division operate as a joint venture, with Platinum Equity taking a 50 per cent interest in the business.
The unit includes some of Europe’s most recognised bottled water brands, including San Pellegrino and Perrier, and the agreement would mark the conclusion of a lengthy and challenging divestment process for the Swiss consumer goods giant.
Nestlé first announced plans in 2024 to separate from the water brands as part of a broader effort to streamline its operations. The company formally carved out the division in 2025 and confirmed earlier this year that it had begun seeking potential investors.
Platinum Equity, founded and led by billionaire businessman Tom Gores, became the preferred bidder after several competing private equity firms, including KKR, Clayton, Dubilier & Rice (CD&R), and PAI Partners, withdrew from the auction.
However, the sale process has faced hurdles, particularly because of regulatory scrutiny surrounding Nestlé’s water operations in France.
French authorities carried out raids at two of the company’s bottling facilities earlier this year as part of an investigation into alleged fraud linked to water treatment practices. The controversy followed a 2024 media investigation that revealed some mineral water sold in France had undergone treatments that were not permitted under regulations.
Nestlé later acknowledged that prohibited treatment methods had been used, intensifying pressure on the company’s water division. The business represented about 3.5 per cent of Nestlé’s total group sales last year.
“It’s not a straightforward deal,” one person familiar with the discussions said, highlighting the challenges surrounding the transaction.
Despite the complications, Platinum Equity has remained committed to the acquisition. The California-based investment firm manages approximately $48 billion in assets and focuses on private equity and credit investments. Its consumer-sector portfolio includes European biscuit producer Biscuit International and dairy company Horizon Organic.
The planned partnership comes as Nestlé continues a wider strategic transformation under new chief executive Philipp Navratil and chairman Pablo Isla, the former chief executive of fashion retailer Inditex.
The company has been working to simplify its structure, concentrate on fewer business categories, and improve efficiency. Nestlé is also exploring the sale of its mainstream vitamins operations as part of the broader review of its portfolio.
The food and beverage giant has previously used joint ventures with private equity investors to reshape its businesses. It partnered with PAI Partners to create Froneri, its global ice cream venture, and also worked with the firm on its European frozen pizza operations.
Nestlé has also sold major water assets in the past. In 2021, the company reached a $4.3 billion agreement with US private equity firm One Rock Capital Partners to sell its North American water business, which included brands such as Poland Spring and Pure Life.
Nestlé and Platinum Equity declined to comment on the latest negotiations.