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Last Updated: Monday, 19 June 2006, 10:12 GMT 11:12 UK
Nestle buys diet firm Jenny Craig
Salad bar at the University of California
Food firms want to exploit many Americans' aim for a healthier diet
Food giant Nestle is buying US diet firm Jenny Craig for $600m (£409.8m) to grow its nutrition and health business.

Jenny Craig offers weight-loss plans and ready-made meals in the US, Canada, Australia and New Zealand.

Nestle acquired the firm from a private equity consortium including ACI Capital and MidOcean Partners.

"The acquisition will reinforce Nestle's nutrition presence in the US, the world's largest nutrition and weight management market," it said.

The US is a very big market for nutrition and wellness, so it makes sense to strengthen their position there
Claudia Lenz, Vontabel analyst

Nestle is increasingly targeting markets where demand for premium products, such as foods which have particular health benefits, is strong.

"Nestle's nutrition division has very high growth and a good margin...so the acquisition is a very good step," said Claudia Lenz, an analyst with investment bank Vontobel.

"The US is a very big market for nutrition and wellness, so it makes sense to strengthen their position there."

The move comes after the Swiss firm bought the nutritional snacks, breakfast and soups business of Australian firm Uncle Toby's last month. Jennie Craig has more than 600 centres in the US providing tailor-made diet plans.

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