AFP, New York :
After buying big American brands like Apple, Pepsi and Yahoo!, activist shareholders – investors in search of big dividends – now are setting their sights on European companies like Nestle.
“No company is really immune from activism except perhaps for the very largest companies,” says Gregory Taxin, managing director of Spotlight Advisory, a consulting firm for activists. The favored targets of activists, said corporate attorney David Katz, at Wachtell, Lipton, Rosen & Katz, are “companies that have a lot of cash that haven’t been returned to shareholders.”
In announcing plans last week to buy $3.5 billion of Nestle shares, US billionaire Daniel Loeb revealed the European ambitions of these investors with bulging wallets who say they want to restore power to shareholders.
In addition to cost-cutting, Loeb is asking Nestle to sell its historic stake in L’Oreal in order to boost the share price and dividends. “L’Oreal has been a fantastic investment,” Loeb’s spokeswoman Elissa Doyle told AFP. However, it is “a non-core investment for a primarily Food & Beverage and packaged goods business.”
