Nestle shares rise as confectioner plans 400 jobs cuts in France
Nestle shares are trading higher Friday as the confectioner plans to shed 400 more jobs in France, according to news agency reports. The Swiss-based food manufacturer is continuing a cost-savings and efficiency push which has resulted in plans to consolidate numerous French sites into one.
By 0850 BST, Nestle shares were trading 0.74% higher at CHF81.46. The Nestle stock price has had a broadly, albeit marginally, negative tone since the beginning of the year.
Nestle continues efficiency savings
Nestle, which employs some 13,000 staff in France, previously announced intentions to shut its seven existing facilities around Paris and create a single one, by 2020. The firm also said in September, it would axe 450 of the 550 jobs in its skincare research centre in Nice.
This latest move by Nestle comes as Hedge Fund Third Point, which owns a 1.25% stake in Nestle, said the confectioner should make further changes to improve stakeholder value.
Daniel Loeb’s Third Point, stated in its fourth quarter investor update message, that Nestle still had work to do, to improve the business and create an even stronger investment proposition.
The four action points he laid out were:
- To clarify its corporate strategy.
- Accelerate portfolio change.
- Deploy the balance sheet.
- Monetize the L’Oreal stake.
Third Point purchased its stake in Nestle for $3.5 billion in June 2017. And, this isn’t the first time Loeb has called for strong action from the food firm in a short period of time.
Nestle R&D staff to move from Switzerland to North Yorkshire
The Swiss-based food and drinks group is also planning to remove its R&D staff from its Swiss offices in Broc, to its tech centre in York.
That means the York office will be the main chocolate and confectionary development centre for the business, in a bid to “improve speed and agility of innovation on a global scale”.
The Chocolate Centre of Excellence in Broc, will remain open. However, the focus of its role will change and include providing support to the broader EMEA market.