(Bloomberg) -- Private equity firm PAI Partners is in the early stages of exploring options for its ice cream joint venture with Nestle SA that includes brands like Haagen-Dazs, according to people familiar with the matter.

The venture, Froneri, could be valued at more than $10 billion in a transaction, the people said, asking not to be identified discussing confidential information. PAI and Nestle declined to comment.

Froneri was created in 2016 when the Swiss company merged its European ice cream business with PAI-owned R&R. In 2019, Nestle sold its US ice cream operation to Froneri for $4 billion. 

PAI could launch a so-called dual-track process in the second half of the year, exploring both a sale and initial public offering of its stake in the business, they said. Nestle is expected to retain its stake, according to the people. Nestle and PAI each own about half of Froneri. 

Sales of ice cream and other treats have been threatened by the booming popularity of a new class of weight-loss drugs including Ozempic. Competition in the ice-cream market also has intensified, with a surge in upstarts selling healthier options.

Paris-based PAI, which has pursued a number of carve-outs from large companies, raised €7.1 billion ($7.6 billion) for its latest fund in November.

Any sale of PAI’s stake would add to the $73 billion of mergers and acquisitions in the food industry over the past 12 months, according to data compiled by Bloomberg. If PAI were to pursue a listing in Europe, it could help revive an IPO market that last year saw the least amount raised in almost a decade. 

Froneri competes with the ice cream business run by Unilever Plc. Since Hein Schumacher became chief executive of Unilever last year, speculation has again stepped up about a separation or sale of the company’s nutrition or ice cream divisions. Schumacher has said improving operational performance is the priority and in October, Unilever named Peter ter Kulve as boss of the underperforming ice cream division — part of a broader overhaul of the company’s leadership.

Nestle shares rose 0.8% to 97.45 Swiss francs at 5:19 p.m. in Zurich.

--With assistance from Dasha Afanasieva and Ruth David.

(Updates to add food M&A statistic in seventh paragraph.)

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