Monday March 15, 2021
At pressure from investors
Danone fires company boss
In the summer there is a conflict between the Danone boss and shareholders. Since then, they have been demanding his release. Two weeks ago, Emmanuel Faber was finally ousted, now he will be expelled without notice. Because of mismanagement in the Corona crisis, as it is called.
The food company Danone is looking for a new boss of "international format": At pressure from shareholders, the company dismissed its previous chairman Emmanuel Faber without notice, as the group announced at its headquarters in Paris. Investors had accused the 57-year-old of mismanagement in the Corona crisis and poor performance against competitors such as Nestlé and Unilever.
Until a new boss is found, two Danone managers are to temporarily head the group: Véronique Penchienati-Bosetta, who is responsible for healthy and sustainable nutrition, and Shane Grant, the North American boss.
After the announcement of Faber's expulsion, Danone's share price on the Paris Stock Exchange rose significantly: the price per share rose at times by more than five percent to a good 61 euros.
Faber was ousted two weeks ago under pressure from investors. At that time it was still said that Faber would remain chairman of the board of directors of Danone. This will now be Gilles Schnepp, the former head of the French electrical engineering group Legrand, as Danone announced.
The US investment fund Artisan Partners, the third largest shareholder in Danone with three percent capital, had insisted on selling Faber completely with immediate effect. Danone had lost a quarter of its market value within a year. Artisan Partners and the London-based Bluebell Capital Partners fund have therefore been putting pressure to fire Faber for months. According to their own statements, they pushed for a "really independent" CEO.
Sales fell by 6.6 percent
Last year, Danone's sales fell by 6.6 percent to 23.6 billion euros. The sale of bottled drinking water even collapsed by more than 20 percent. Faber had promised a "return to growth in the second quarter" in 2021.
Faber has been General Manager at Danone since 2014 and CEO since 2017. He had initiated a restructuring process that provides for up to 2,000 jobs to be cut. This should save one billion euros by 2023. Investors also turned against this plan called "Local First".
The conflict between Faber and the shareholders began last summer. At the annual general meeting in June 2020, the majority of the shareholders approved new articles of association with which Faber wanted to prescribe "social, societal and environmental goals" for the group. Artisan Partners had voted against. Critics also accused the Danone boss, who had now been shot, to go it alone.
Danone was founded as a yogurt company in Barcelona in 1919. Today the group has a global presence and includes brands such as Evian, Volvic and Activia.
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