Nestle has agreed to buy Sweet Earth, a U.S.-based maker of meatless frozen foods, as it looks to expand its portfolio of healthier products.
The Swiss company, Europe`s largest by market value, said on Thursday that the purchase of Sweet Earth marks its first foray into the U.S. market for plant-based foods, a global sector growing at a double-digit rate annually and expected to reach $5 billion by 2020.
Nestle and its processed food peers are battling slowing sales growth as consumer tastes and habits change, favoring smaller brands seen as healthier or more artisanal.
Unilever also announced an acquisition on Thursday, of small organic herbal tea brand Pukka.
Nestle, better known for KitKat bars, Nescafe coffee and Hot Pockets, did not disclose the price it paid for Sweet Earth, which makes frozen meals, burritos, breakfast sandwiches and burgers using meat alternatives like tofu and seitan.
Nestle said the brand would remain independent from its U.S. food business and continue to be led by its founders.
Nestle has said it wants to become a "nutrition, health and wellness" company. It is in the process of selling its U.S. confectionery business, which includes Butterfinger and Baby Ruth bars.
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