Ferrero buys Nestle's U.S. candy business for $2.8 billion

Swiss food and beverage company Nestle is selling its U.S. candy business to Italian confectioner group Ferrero for $2.8 billion in cash, Ferrero announced Tuesday.

Ferrero will take control of more than 20 Nestle brands including Butterfinger, BabyRuth, 100Grand, Raisinets and Wonka. The Alba, Italy-based company will also acquire Nestle's U.S. manufacturing facilities in Bloomington, Franklin Park and Itasca, Illinois.

"We will have substantially greater scale, a broader offering of high-quality products to customers across the chocolate snack, sugar confectionary and seasonal categories, and exciting new growth opportunities in the world's largest confectionery market," Giovanni Ferrero, executive chairman of the Ferrero Group, said in a statement.

Nestle said last July that it was wrapping up a review of strategic options for the U.S. candy business and that an exit was possible. In early 2017, the company said that candy sales in 2016 were disappointing, and global pricing pressure had forced it to cut costs. Its candy brand represents about 3 percent of U.S. sales, according to the company. Nestle also makes Purina pet food, bottled water, Stouffer's and Gerber baby foods.

Late last year Nestle, the world's largest coffee producer, acquired a majority stake in gourmet coffee company Blue Bottle and purchased premium coffee brand Chameleon Coffee.  Nestle already owns coffee brands Nescafe and Nespresso.