Nestle Canada sells its Pure Life bottled water brand

The move is part of a broader strategic mandate to focus on better performing brands and categories.

Nestlé Canada is offloading its Pure Life Bottled Water brand to Shelburne, Ont.-based Ice River Springs, as it continues a strategic shift to brands and categories that represent the highest growth opportunities.

The sales includes two factories located in Puslinch, Ont. and Hope, B.C., along with a well in Erin, Ont. The deal is expected to close in Q3, contingent on regulatory approval. There were no financial terms disclosed for the deal, which is only for the Canadian Pure Life business, now separate from the North American strategic review announced earlier this month.

According to Jeff Hamilton, president and CEO of Nestlé Canada, the CPG player had determined that it is “best positioned to focus on our iconic international brands of San Pellegrino, Perrier and Acqua Panna.” Hamilton added that he is pleased that Ice River Springs, a local Canadian company with a focus on sustainability, agreed to purchase the business.

Ice River Springs is a privately-owned Canadian company that has traditionally been focused on producing private label bottled water, though is in the midst of a strategic plan to expanding its portfolio of brands, which currently includes Ice River Green. The company also tries to be sustainability minded, running BMP Recycling which takes bottles and plastic food packaging to produce recycled PET plastic.

This move comes on the heels of Nestlé global announcing in June that it has joined “Race to Zero,” a global campaign effort committed to achieving net-zero emissions by 2050, as consumers increasingly look askance at the bottled water business and municipalities attempt to curb single-use plastics. However, earlier this year chief executive Mark Schneider emphasized that “in the right segments, water remains very attractive,” pointing to growth and margin opportunities of more up-scale and sparkling brands, like Perrier.

In February, Schneider set out his vision on selling premium products in other high-growth categories, such as pet food and coffee (Nescafe, for example, has made additions to its specialty at home coffee lines).

Nestle is also pivoting away from slower growth areas, such as ice cream and confectionery. It sold its American confectionery business (and over 20 brands, including Crunch and Butterfinger) to Italian manufacturer, Ferrero in 2018. Last year it announced it was selling off its skin health unit, including the Proactiv skincare brand, to private equity firm EQT Partners out of Abu Dhabi.

Earlier this year, Pure Life Bottled Water was named as one of Canada’s Most Trusted brands, according to Reader’s Digest’s annual survey.

According to Euromonitor insights, flavour innovation and natural fruits are retaining consumer interest in an increasingly competitive landscape, which includes a strong representation by private label. PepsiCo Canada and juice player Lassonde have both invested in flavoured and sparkling bottled water as consumers increasingly move towards healthier beverages.