Nestle to buy Gerber for $5.5bn

Nestle has been expanding its portfolio through acquisitions

Swiss firm Nestle, the world's largest food company, is to buy US baby food firm Gerber from Novartis for $5.5bn (£2.8bn) in cash.

Novartis said the move was part of its plan to focus on healthcare, with a focus on pharmaceuticals.

The move by Nestle comes more than a decade on from its last attempt to buy Gerber in 1994, and comes as the food giant recently posted record profits.

The purchase is the latest in a string of acquisitions by the group.

Nestle's latest yearly results included $3.8bn (£1.9bn) on acquisition, of which $2.5bn was spent on buying a medical nutrition business from Novartis.

Novartis said the sale was part of a decade-long plan to invest in R&D (research and development) and build its healthcare businesses "while divesting over 50% of our non-core, non-healthcare businesses".

Gerber has 300 food items for babies and infants plus baby-care products.

In February, Nestle posted full-year net profits of 9.2bn Swiss francs ($7.4bn; £3.8bn), a rise of 13.8% on a year earlier.