Italy’s Ferrero has agreed to buy the U.S. confectionery business of Swiss food group Nestle for $2.8 billion in an all-cash deal. The business has about $900 million in sales and represents roughly 3 percent of U.S. Nestle Group’s sales. The deal is expected to be completed near the end of the first quarter, Nestle said. The sale doesn’t include the company’s global chocolate brand KitKat or the Toll House baking line.

Giovanni Ferrero, executive chairman of the Ferrero Group, said in a statement, “We are very excited about the acquisition of Nestle’s U.S. confectionery business, which has an outstanding portfolio of iconic brands with rich histories and tremendous awareness.” The acquisition will make the Italian company the third-largest chocolate company in the U.S. and globally. Ferrero was advised by Credit Suisse and Lazard while Davis Polk and Wardwell acted as its legal adviser.

This will be CEO Mark Schneider’s first big sale of his tenure. The unit held a weak position in the U.S. market, falling behind Hershey, Mars, and Lindt. Nestle‘s mass-market chocolate bars have underperformed rivals for years. The company could be planning to dispose of other weak brands as well. Last week, Nestle said it was selling its Australian chocolate bar line, Violet Crumble.

Nestle is currently the world’s biggest packaged-food company, according to the 2017 Forbes Global 2000. Nestle’s American candy lines include Nestle Crunch, Butterfinger, Baby Ruth, Raisinets, Nips, Skinny Cow and Laffy Taffy. Hershey owns Nestle‘s KitKat brand in the United States. Nestle also owns Purina, Coffee-Mate, Gerber and Stouffer’s

Family-owned Ferrero is the maker of Nutella spread, Tic Tacs, and Ferrero Rocher pralines. In May, Ferrero bought Fannie May Confections Brands for $115 million from 1-800-FLOWERS. In October, the company announced plans to buy Ferrara Candy Co. for an undisclosed amount.

Nestle is attempting to move towards healthier products. The Swiss company wants to focus on “nutrition, health and wellness,” according to its statement. Consumers are shifting away from junk and sugary foods and have turned towards healthier snacks such as fruit bars. Nestle agreed to pay $2.3 billion last month for vitamin maker Atrium Innovations, which has about $700 million in annual sales. The company is also bidding for the vitamin and supplements business being sold by Germany’s Merck.