Nuun acquisition “fits the bill” for Nestlé Health Science’s functional hydration market entry

11 May 2021 --- Nestlé Health Science (NHSc) has agreed to acquire Nuun, a functional hydration brand in the sports beverage market. 

Nuun’s portfolio consists of a range of low-sugar, electrolyte effervescent tablets and powders tailored for exercise, energy and rest, but also travel, immune support and daily health.

“We’ve been looking at the functional hydration category for some time,” Jacquelyn Campo, senior director of NHSc corporate communications, tells NutritionInsight.

“We took our time in making an acquisition because we wanted to be sure that it was the right strategic move for us with a brand that aligned with our philosophy and culture,” says Campo. 

“Nuun fit the bill for a number of reasons,” she continues. “First of all, it’s built on the foundation of high-efficacy, clean ingredients. All of its products are non-GMO, vegan, gluten-free and certified carbon neutral.”

Nuun’s range of effervescent tablets and powders complement NHSc’s active lifestyle nutrition portfolio.The transaction is expected to close in Q3 2021. Financial details are not being disclosed. 

The growing hydration market
Founded in Seattle, US, Nuun began researching the separation of electrolyte replacement from carbohydrates in 2004. Its low-sugar electrolyte tablets “revolutionized the sports beverage market,” says NHSc. 

“Everyday health-conscious consumers are becoming more aware of how functional hydration products can add to their overall well-being as well as support them during exercise by replacing the minerals that the body loses,” says Greg Behar, CEO of NHSc. 

“That growing awareness is reflected in the steady growth of the category,” says Behar. For example, FMCG heavyweight PepsiCo recently launched its second functional water for mental stamina last week, after its initial Driftwell relaxation drink launch last September.

Further evidence of the functional beverage market growth are Rebbl’s adaptogenic drinks line with immune health support, as well as Mude functional drinks brought to North America in a US$12 million investment move.

Recently, Nuun launched a healthy energy drink substitute called Nuun Energy, formulated with ginseng, green tea, electrolytes and B vitamins. Immunity3 is Nuun’s latest release in the immunity sector, a powder product created with prebiotics, elderberry extract, electrolytes and vitamins.

NHSc states Nuun’s low-sugar electrolyte tablets “revolutionized the sports beverage market.”“Nuun’s products are proven to work,” highlights Campo. “They’ve been clinically studied against the Beverage Hydration Index and have been proven to increase total water absorption and retention over drinking water.” 

Nestlé’s expansion trajectory
According to Nestlé’s full-year 2020 financial results, NHSc grew at a double-digit rate, reflecting higher demand for products that support health and the immune system.

The move to snap up Nuun follows Nestlé’s recent acquisition of The Bountiful Company’s core brands for US$5.75 million.

Recently, NutritionInsight delved into what’s driving the functional beverage market, while Kerry predicted a surge of functional drink NPD targeting consumers who are approaching health holistically due to the COVID-19 threat. 

By Anni Schleicher