Nestle raises £17bn from Alcon stake

The agreement to sell the remaining 52 per cent holding in Alcon to healthcare firm Novartis is expected to raise 28.1 billion US dollars (17.4 billion).

The food giant said it had realised more than 40 billion US dollars (24.7 billion) from Alcon after selling a quarter of the business on the stock market in 2002 and a further 24.8 per cent stake to Novartis in 2008.

The Swiss drugs firm held an option to buy the remainder of the company from this month.

Alcon is the world's largest eye care company with 2008 sales of 6.3 billion US dollars (3.9 billion) and annual net earnings of 2 billion US dollars (1.2 billion). It is a supplier of contact lens solutions, as well as surgical and pharmaceutical products.

Nestle's fundraising will fuel speculation that it could use some of the proceeds for acquisitions, although it has yet to disclose any interest in bidding for UK takeover target Cadbury.

Nestle plans to use some of the cash to extend its share buy-back programme by another 10 billion US dollars (6.2 billion) over the next two years. It is currently in the process of returning 25 billion US dollars (15.5 billion) to shareholders.

Chairman Peter Brabeck-Letmathe said his company's support had enabled Alcon's management to turn a minor player in the industry into a global leader of the ophthalmologic sector.

Chief executive Paul Buckle added the sale would enable Nestle to concentrate on "accelerating" its development as the world's leading nutrition, health and wellness company.

Leading brands in the Nestle portfolio include Smarties, KitKat, Perrier and Nesquik.

Alcon was founded in 1945 in Fort Worth, Texas and currently employs around 15,000 people worldwide. It has its UK base at Hemel Hempstead in Hertfordshire, as well as a facility at Cork, Ireland.