Artisan Partners goes against Danone
The fund is a minority shareholder with approximately 3% of the shares
The investment firm Artisan Partners has requested that changes in governance and strategy be made in Danone through a letter addressed to one of the board members of the French food company, Gilles Schnepp. "Unfortunately, Danone's financial performance is not consistent with the quality of its assets", said the US fund, adding that "on almost every metric, Danone's performance has lagged behind".
Artisan Partners - which said it holds a stake of more than 3% in Danone - also asked for the separation between the role of president and CEO of the food company, adding that "adequate standards of corporate governance require truly independent directors".
The fund also criticized Danone's capital allocation as destructive to value, also calling the scarcity of investment in innovation and product development a problem. "Danone may also be considering mergers, acquisitions or divestments that could further complicate or weaken the business", continued Artisan Partners, noting that "although Danone has great assets and its brand is loved by consumers, its margin has had lower performance than competitors ".
The French group has not yet disclosed the results for 2020. The latest data available, relating to the third quarter, reported revenues for the first 9 months of € 18 billion, down by 5.4% compared to the corresponding period of 2019.
Danone has not yet responded to Artisan Partners' comments.
EFA News - European Food Agency