Nestle To Buy Jenny Craig In $600 Million Deal

VEVEY, Switzerland -- A Swiss company, perhaps best known in the U.S. for chocolate, is buying the Jenny Craig diet company.

Nestle, which is the world's biggest food and drink company, said it is paying $600 million for Jenny Craig.

The current Jenny Craig management team, based in Carlsbad, Calif., will report directly to Nestle.

Jenny Craig employs more than 3,000 people. It is being purchased from two private equity groups. The transaction is expected to close in the third quarter.

Weight management will become a new business within Nestle's nutrition unit. The Swiss company already owns the Lean Cuisine line of foods.

"With this strategic acquisition, the group takes another important step in its transformation process into a nutrition, health and wellness company," said Nestle Chairman and Chief Executive Peter Brabeck-Letmathe.

"The rise of obesity and the resulting metabolic disorders, such as diabetes and cardiovascular disease, is a major public health concern, not only in the USA but also the world over. The Jenny Craig acquisition puts us in a privileged position to help many of our consumers," Brabeck-Letmathe said.

Jenny Craig has more than 600 weight-loss centers in the U.S., Canada, Australia and New Zealand.

It generated sales of more than $400 million in the past 12 months.