Danone confident on 2012, water still strategic
By Dominique Vidalon
PARIS (Reuters) - French food group Danone SA (DANO.PA: Quote) gave a confident outlook for 2012 and said its water business was "still strategic", in response to renewed speculation it was in talks on a disposal.
The world's largest yoghurt maker, whose brands include Actimel and Activia, said it was positive for next year as softening commodity prices, robust growth in emerging markets and the benefits from the acquisition of Unimilk in Russia would underpin growth.
Chief Financial Officer Pierre-Andre Terisse told analysts bottled water remained a strategic business for Danone, owner of Evian, Volvic and Badoit, though he declined comment on a Bloomberg report Danone was in talks with Japan's Suntory Holdings SUNTH.UL to sell water assets.
Suntory said it was not in talks to buy the French group's water activities.
Danone, the world's No 2 bottled water producer, was in early talks with unnamed parties on such a deal, a source familiar with the matter had told Reuters last November.
Helvea analysts said in a note that a water disposal would be "no real surprise, given we think Danone will be interested in Pfizer's Wyeth baby food business and might want to trade its water division in order to avoid a capital increase."
A banking source close to the situation told Reuters in August that European food groups Nestle NESN.VX and Danone were the early front runners working on bids for Pfizer's (PFE.N: Quote) Wyeth, worth up to $10 billion.
One sector analyst valued Danone's water business at 5.6-6.4 billion euros. Continued...