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Nestle balancing its diet

Lisa Napoli Jun 19, 2006

KAI RYSSDAL: The Swiss food giant Nestle today said it’s going to fatten up its nutritional portfolio. It’ll pay $600 million for the diet company Jenny Craig. It might seem a bit odd for the purveyor of Kit Kats to consume a weight loss company. But I got a phrase for you here. Vertical integration. Marketplace’s Lisa Napoli explains the balance in Nestle’s diet:

: Incongruity is the modern business principle. just look at Toyota, the maker of both the virtuous Prius and the gas-guzzling Land Cruiser.

Nestle Vice President Laurie McDonald says her company is as much about nutrition as it is about sweets:

LAURIE MCDONALD: Nestle is a company with a broad portfolio so, yes, we have indulgent products. But in that indulgent portfolio we’ve got portion-controlled, lower fat products. So there’s really choice for everyone.

Owning Jenny Craig gives Nestle its first weight-loss service. Thanks to some wise management choices, souped-up stores, and celebrity spokes-slimmer Kirstie Alley, Jenny’s nearly doubled its client base over the past four years — without opening new locations.

Kent Kreh’s chairman of the Jenny Craig board. He says, at this stage, Jenny needs Nestle’s muscle:

KENT KREH: When you realize that they have 250,000 employees operating in almost every country in the world, I think it’s natural to assume that they would, down the road, look at expanding this into additional markets.

Especially given this moment in time when junk food’s getting a bad rap and the spotlight’s on our national problem with obesity.

NAT WARDEN: You want to go where there’s growth.

Nat Warden is a reporter with TheStreet.com.

NAT WARDEN: Baby boomers are retiring and these are people that spend a lot of money and they spend it on their lifestyle and they’re looking to improve their choices and live healthier.

And perhaps the quest to slim down will fatten up Nestle’s coffers.

In Los Angeles, I’m Lisa Napoli for Marketplace.

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