Nestlé S.A. / Nestlé to acquire Kraft Foods' frozen pizza business processed and transmitted by Hugin AS. The issuer is solely responsible for the content of this announcement. 

Nestlé  has agreed to acquire  Kraft Foods' frozen pizza  business in the US and
Canada  for  USD  3.7 billion  in  cash.  The  business  includes brands such as
DiGiorno,  Tombstone, California Pizza Kitchen, Jack?s and Delissio. This frozen
pizza business provides a new strategic pillar to Nestlé?s frozen food portfolio
in  the US and Canada, where the Company has already established a leadership in
prepared  dishes  and  hand-held  product  categories under the Stouffer's, Lean
Cuisine,  Buitoni, Hot Pockets  and Lean Pockets  brands. The acquisition brings
leadership  in the frozen pizza category, where Nestlé only had a minor presence
until  now, and  builds on  Nestlé?s existing  pizza know-how  and operations in
Europe.  It  is  a  natural  fit  with  Nestlé?s focus on delivering convenient,
premium,  wholesome and nutritious  frozen food for  consumers around the world.
The  transaction  is  subject  to  US  and  Canadian  regulatory approval and is
expected to be completed in 2010.

Paul  Bulcke, CEO of Nestlé, said:  "This frozen pizza business greatly enhances
Nestlé's  frozen food activities in North America, bringing together a selection
of   great   US   and   Canadian  brands,  industry-leading  R&D  and  excellent
route-to-market   capabilities,   which   complement   our  existing  ice  cream
direct-store-delivery.  With total  sales of  around CHF  3 billion, Nestlé will
become the world leader in the attractive, fast-growing frozen pizza category."

The US is the largest pizza market in the world with consumer sales of about USD
37 billion.  With estimated sales of USD 2.1 billion in 2009, Kraft Foods is the
leader  in the frozen pizza category and  has enjoyed double-digit growth in the
US  and  Canada  over  the  last  four  years. The DiGiorno and California Pizza
Kitchen  brands have  driven the  development of  the premium segment, providing
consumers  and families attractive alternatives to eating out and home delivered
pizzas.  The  business  also  includes  other  strong  brands with Tombstone and
Jack?s. In addition, Delissio is the leading frozen pizza brand in Canada.

The  business  will  be  part  of  Nestlé  USA.  "Our  combined  capabilities in
direct-store-delivery,  R&D,  innovation  and  commitment  to quality, taste and
convenience make this a good strategic fit with our frozen food portfolio," said
Brad Alford, Chairman and CEO of Nestlé USA.

The  business has an estimated 2009 EBITDA of USD 297 million or 14.2% of sales,
and  an estimated EBIT of USD  279 million. Synergies, estimated at 7% of sales,
will  be  fully  realized  within  five  years.  On  a  pre-synergy  basis,  the
transaction is priced at 1.8 times estimated 2009 sales and 12.5 times estimated
2009 EBITDA.  The acquisition  will enhance  Nestlé's earnings  per share in the
first  full  year  of  ownership.  All  above  financial  estimates are based on
Nestlé's IFRS accounting standards.




Contacts
International media        Robin Tickle                   +41 21 924 22 00
US media                     Laurie MacDonald           +1 (818) 549 62 35
Canadian media            Catherine O'Brien            +1 (416) 218 26 88
Investors                       Roddy Child-Villiers        +41 21 924 36 22


[HUG#1370169]



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