BN Danone

By Olivia Bugault

Investment company Artisan Partners is calling for corporate governance and strategy changes at Danone SA in a letter addressed to an independent board member of the French food company, Gilles Schnepp.

"Unfortunately, the financial performance of Danone is not consistent with the quality of its assets," Artisan Partners said on Thursday, adding that "on almost every measure, Danone's performance has lagged."

Artisan Partners--which said it has a stake of more than 3% in Danone--is asking for a separation of the role of chairman and chief executive officer at the food company. "Further, proper corporate governance standards require truly independent directors, to the exclusion of former company management," it added.

Artisan Partners also criticized Danone's capital allocation that is value-destructive, while underinvestment in innovation and product development is also an issue, it said.

"Danone may also be considering merger, acquisition or disposal activity that could further complicate or weaken the business," Artisan Partners said.

Although Danone has great assets and its brand is loved by consumers, its margin has been underperforming compared to its peers, Artisan Partners said.

Shares at Danone are up 2.6% at EUR54.72.

Danone wasn't immediately available for comment.

Write to Olivia Bugault at olivia.bugault@wsj.com

(END) Dow Jones Newswires

February 11, 2021 04:02 ET (09:02 GMT)

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