Advertisement
  1. News
  2. /
  3. Business

Nestlé selling Zephyrhills spring water, other bottled brands for $4.3 billion

The water company, which sources from Crystal Springs, is being sold to a pair of investment firms.
Bottles of Zephyrhills Natural Spring Water move along conveyors through the plant in Zephyrhills in 2014.
Bottles of Zephyrhills Natural Spring Water move along conveyors through the plant in Zephyrhills in 2014.
Published Feb. 17
Updated Feb. 17

Zephyrhills Natural Spring Water, a Pasco County brand that has pumped water from nearby Crystal Springs into bottles on store shelves throughout the Southeast, is being sold by parent company Nestlé as part of a $4.3 billion deal.

Nestle is selling the bulk of its North American bottled water business to a pair of investment firms, One Rock Capital Partners and Metropoulos & Co. Among the water brands affected: Poland Spring, Deer Park, Ice Mountain, Arrowhead, Ozarka, Pure Life, Splash and ReadyRefresh.

But in Tampa Bay, the name that will resonate the most is Zephyrhills, which employs some 400 local workers.

“As someone who grew up here, the Zephyrhills water brand has been an institution, and one we have been proud of,” said Melonie Monson, president and CEO of the Greater Zephyrhills Chamber of Commerce. “Our hopes will be that the facility here in Zephyrhills will continue to keep running strong and no jobs will be lost in this transition.”

Founded in 1964, the company grew into a multi-billion-dollar business, selling in 1987 to Perrier, which was later acquired by Nestlé. The world’s largest food and beverage conglomerate pushed to pump more water from the state’s aquifer, striking a deal with local landowners to run pipes into the Crystal Springs. Those springs are now part of the 530-acre Crystal Springs Preserve.

At the time the company turned 50 in 2014, Florida’s aquifer was pushing 30 million gallons of water a day through the spring, 650,000 gallons of which flowed into Zephyrhills bottles. The company now pulls water from five springs around the state.

Related: From 2008: That bottled water can spring from anywhere

The Zephyrhills brand is deeply associated with the town that shares its name — so much so that its official seal features the phrase “City of Pure Water.” Nestlé and Zephyrhills have sponsored various environmental initiatives, including Crystal Springs Preserve’s 4,000-square-foot nature center, which draws student tour groups from around central Florida.

Guests visit a Zephyrhills Natural Spring Water hybrid delivery truck on display at the Make-a-Splash festival at Crystal Springs Preserve in 2010.
Guests visit a Zephyrhills Natural Spring Water hybrid delivery truck on display at the Make-a-Splash festival at Crystal Springs Preserve in 2010. [ Tampa Bay Times ]

“I have no idea if a new brand would at least try to do the right things that Nestlé has tried to do,” said Robert Knight, executive director of the nonprofit Howard T. Odum Florida Springs Institute. “Nestlé is very unpopular in general because of things they do elsewhere, but in Florida, they’re being responsible.”

Still, Nestlé has created controversy as it sought to pump more and more water from Crystal Springs and other springs statewide. As the company boosted Zephyrhills production, it led landowners to close parts of the spring to the public, including a popular swimming hole. Even now, Nestlé and one of its partners are seeking a permit to pump nearly 1 million gallons a day from Ginnie Springs in Gilchrist County in order to boost production at a bottling plant near High Springs.

Related: Zephyrhills celebrates 50 years of bottling water

The brands included in the deal employ more than 7,200 workers across North America. According to Nestlé, they accounted for sales of nearly $3.8 billion in 2019.

Yet in recent financial reports, Nestlé reported struggles with its bottled water sector as more people stayed home during the coronavirus pandemic and made fewer impulse, grab-and-go purchases.

In a statement, One Rock and Metropolous & Co. indicated Nestlé's “iconic” portfolio of water brands would continue as a standalone company. Dean Metropolous, founder of his family firm — which has invested in a range of food and beverage brands, including Hostess Brands, Utz, Ghirardelli Chocolates and Pabst Brewing Company — serving as chairman and CEO.

“This is an important inflection point for the business as it transitions to an independent company” he said. “I look forward to collaborating with One Rock and (Nestlé's) management team to deliver unparalleled value to our customers.”

Holding tanks for spring water tower above the Zephyrhills Natural Spring Water bottling plant in Zephyrhills in 2014.
Holding tanks for spring water tower above the Zephyrhills Natural Spring Water bottling plant in Zephyrhills in 2014. [ SKIP O'ROURKE | Tampa Bay Times ]

From an economic perspective, any change to Zephyrhills Bottled Spring Water’s Pasco operations would be a big one.

Zephyrhills city manager Billy Poe said Nestlé has been “a great partner in the community” with whom the city has had “a positive working relationship,” and they’re looking for more of the same with the new owners.

Monson said she hopes the new owners can “revitalize the Zephyrhills brand” with as little turnover as possible.

“The loss of those jobs, especially during this difficult time, could be devastating for our families,” she said. “We hope that this will not be the case with the new company taking over.”

On the flip side, there’s always the chance the company could grow, or at least try to boost production. Like Nestle, the new owners could lobby for a bigger permit to pump out even more of Florida’s water to bottle and sell for a profit, Knight said

“There’s tremendous profit to be made from bottled water,” he said. “At least there has been in the past. But maybe Nestlé’s realizing something different about spring water in Florida.”