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2017.06.2722:26:00UTC+00Nestle to Launch Share Buyback Amid Shareholder Pressure

Nestle announced its plan to repurchase as much as 20 billion Swiss Francs worth of shares in a span of three years as it reacts to U.S. activist shareholder Third Point LLC's launched campaign to bolster the company's performance.

The hedge fund, managed by investor Daniel Loeb, revealed a $3.5 billion stake in the firm when it began calling for Nestle to step up its initiatives to boost performance and called for a share buyback.

The maker of popular brands such as Gerber baby food and Perrier water said the announcement was the outcome of an assessment of its priorities, a review that started in early 2017. The company did not mention Third point in the official statement it released.

But Nestle's CEO Mark Schneider stated at the firm's Q1 result presentation that he understood shareholders' desire to see significant actions towards enhanced combinations of the pace of growth and margins.

The volume of the share buybacks on a monthly basis will still be dependent on market conditions but likely occur in 2019 and 2020 so the firm can mull acquisitions ahead of the period.

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