Thursday, June 29, 2017
U.S. activist shareholder Daniel Loeb (pictured) and his hedge fund company, Third Point LLC, has targeted Nestlé by taking a US$3.5-billion stake in the food maker and urging it to boost returns as demand for its products weakens, according to a Reuters report.
Nestlé shares jumped as much as 4.8 per cent on Monday touching a record high (and adding $10 billion to its market value), after Third Point disclosed its position late on Sunday in a letter to the hedge fund's investors.
In the letter, Third Point said it was urging the Swiss group to improve margins, buy back shares and divest of non-core businesses, including its $27-billion stake in L'Oréal.
Third Point's 40 million shares – or 1.3 per cent of the total – make it Nestlé's eighth-largest shareholder, according to Thomson Reuters data.