Nestle to Return USD 20 Billion to Investors

Brimming with $10 billion cash after selling a dermatology unit earlier this month, Nestle SA will start a new share buyback programme in January and may complement it with special dividends over the next three years, the firm said according to media reports.

The Swiss food giant plans to return close to $20 billion to shareholders by the year 2022 and indicated an appetite for acquisitions to help Chief Executive Officer Mark Schneider sustain faster growth and better profit margins, Bloomberg reported.

In addition, it will also reorganise the company’s stagnating bottled-water business, which may exit underperforming brands.

Schneider is close to the end of his third year as the head of the food giant and the company’s market value has increased by almost $80 billion in his tenure.

The maker of Nescafe and KitKat bars has bought more than 20 companies under him, who was the first outsider to gain the position in almost a century.

By cutting about 4,000 jobs from the frozen-food delivery business in the US, helped put the company on track for savings of 1.9 billion francs ($1.9 billion) this year, said Bloomberg in its report.

Nestle signaled it’s sharpening its M&A focus further as it unveiled a new management group that will seek out growth opportunities, to be led by Sanjay Bahadur, a 37-year corporate veteran who has been head of acquisitions for the past decade and finance director for greater China before that.

Nestle's shares have surged to record levels in CEO's third year Nestle said it would prefer to make investments to expand its main businesses, and it would scale down the buyback target if any sizeable acquisitions pop up.