Nestlé, Under Pressure, Plans Buyback and Perhaps Acquisitions
Nestlé said that the plans it announced on Tuesday had arisen from a regular review of the company’s capital positions — its top managers began the review in January — and
that the announcement was not a response to Mr. Loeb’s activist campaign.
Yet Nestlé’s new strategic course came out only two days after Mr. Loeb’s hedge fund, Third Point, emerged as one of the company’s biggest shareholders
and presented suggestions aimed at shaking up what Third Point described as a significant underperformer.
By MICHAEL J. de la MERCEDJUNE 27, 2017
LONDON — In revealing his investment position in Nestlé on Sunday, the hedge fund manager Daniel
S. Loeb urged the company to consider slimming down, as well as buying back its stock.
On Tuesday, Nestlé said it was indeed prepared to spend billions of dollars on buybacks — but the company also suggested
that it might pursue a number of acquisitions in addition to shedding businesses.
The company added that it would consider making acquisitions in fast-growing parts of its
business portfolio, including coffee, pet care, bottled water and consumer health care.
The plan suggests significant change at Nestlé, the Swiss food giant whose products include Kit Kat bars
and Stouffer’s frozen pizzas, at a time when its once-enviable growth rates have declined as consumer tastes change.