Nestl sold its remaining majority holding in eyecare major Alcon, which it acquired for just $280 million in 1977, to the Swiss drugmaker Novartis.
Analysts said the deal would give Nestl a war chest for a potential move on British confectioner Cadbury, which is fighting a hostile 10bn takeover bid from US group Kraft Foods.
One City food manufacturing analyst said: "If Nestl wants Cadbury there will now be less concern about what the funding of any bid would do to the group's balance sheet. It would be a straight strategic play instead."
Novartis is exercising an option to buy a 52 per cent stake in Alcon, boosting its holding to 77 per cent. It bought an initial 25 per cent stake in the company from Nestl, the world's biggest food group, in 2008.
The Swiss firm was again non-committal on Cadbury yesterday. A statement said: "This divestment of our interest in Alcon will enable our management to concentrate on accelerating the development of Nestl's position as the world's leading nutrition, health and wellness company."
However, analysts noted Nestl's separate announcement yesterday that the deal would allow it to launch a new Swfr10bn (5.9bn) share buyback programme for two years once its existing 15.5bn buyback is completed this year.
The scale of the new buyback was less than many analysts had forecast, stoking speculation that Nestl could also use some of the Alcon proceeds for acquisitions.
Jon Cox, an analyst with Kepler Capital Markets, said: "The 10bn franc buyback announcement could disappoint investors and renew speculation that Nestl is about to get involved in a large M&A transaction."
Yesterday's potential twist in the Cadbury takeover battle comes as the City believes Kraft may be on the verge of raising its bid for the British group.
Kraft's cash-and-shares offer is nearly 60p below the Cadbury price, which closed yesterday up a further 7.5p at 805p.
The City's takeover watchdog has extended the deadline for any material new information from Cadbury in its defence by three days to Friday, 15 January from the earlier deadline of 12 January.
The Takeover Panel has said it is extending the deadline to allow the release of Cadbury's detailed estimated trading results for 2009.
Meanwhile, Hershey of the US and Italy's Ferrero are understood to have indicated to Cadbury an interest in making potential offers for the company but none has so far materialised.