Tuesday, April 24, 2012


The Swiss company is paying about 5 times the estimated 2012 revenues of $2.4 billion to acquire Pfizer's infant nutrition business. The world's biggest food group will pay $11.85 billion in cash for the acquisition. Nestle is paying 20 times current year Ebitda. Even if the food conglomerate grows at 15% annually for the next 5 years, the new investment would generate less than 7 % return. However opportunities to buy big and potentially high growth markets are also rare.

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