Evian bottled water producer Danone is reportedly facing calls from an activist investor to make further changes to the way the company is run.
According to a report on France’s Challenges.fr, Bluebell Capital Partners, which bought an undisclosed stake in Danone at the end of last year, has written to Danone’s management asking for governance changes. Bluebell demanded a separation of the functions of chairman and chief executive officer and called for the replacement of CEO Emmanuel Faber.
In a statement to just-drinks sister site just-food in response to news stories about Bluebell’s call, Danone said: “The leadership team of the company is highly focused on delivering long-term sustainable value for our shareholders. We value constructive dialogue with all our shareholders.”
Danone has already announced a number of structural changes as part of a cost-cutting exercise in order to reboot profit margins.
In November, Faber revealed a new locally-focused corporate structure under six separate zones each with its own leadership team to promote, among other things, product development that fits with local trends and demands. The company also plans to cut up to 2,000 jobs and eliminate 20% of its SKUs.
In December, Danone announced it was creating a strategy transformation committee to sit beside three existing board committees that oversee audit functions, governance and engagement. It also revealed that Cécile Cabanis, the former CFO who stepped down in October, had been appointed vice chair of the board in a non-executive capacity.
Commenting on London-based Bluebell’s demands, Jefferies analyst Martin Deboo broadly agreed with the group. Quoted in the UK’s Financial Times newspaper, Deboo said Danone’s current management has “a poor operational record and [have made] questionable capital-allocation choices”.
Bruno Monteyne at Bernstein warned about difficulties to come at Danone despite the changes announced at the end of last year.
“It may be years of pain before investors will know whether that new plan is any better than the old one,” he said.
just-food contacted Bluebell Capital Partners seeking further information.
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