Nestle poaches CEO from Fresenius in health and wellness drive

Mon Jun 27, 2016 2:03pm EDT
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By Brenna Hughes Neghaiwi

ZURICH (Reuters) - Nestle SA (NESN.S: Quote) named Ulf Mark Schneider as its next chief executive in a surprise choice on Monday, as the Swiss food giant underlined a shift towards health and wellness by poaching the boss of German healthcare group Fresenius (FREG.DE: Quote).

Schneider will replace Nestle's long-standing CEO Paul Bulcke, whom the board has proposed as chairman when 71-year-old Peter Brabeck-Letmathe hits mandatory retirement age next year.

Nestle's appointment of Schneider, a U.S.-German dual citizen, marks the company's first external hire for the CEO job in nearly a century.

"This is a truly iconic global company with a proud heritage and tremendous future prospects," Schneider, 50, said in a statement released after the market close.

Earlier in June, Brabeck hinted the company could be eyeing external candidates for the CEO role, although many analysts and shareholders still expected it to continue its tradition of promoting internally.

Nestle's best-known goods range from baby food to coffee and chocolate, but it has been investing more recently in higher-margin, higher-growth healthcare products as it tries to fend off criticism that its scale stifles agility.

It has signed a series of deals with small companies in its bid to create a new kind of business that is midway between food and pharmaceuticals. The goal is to find new ways to treat, diagnose and prevent a range of diseases, from gastrointestinal problems to Alzheimer's.

Nestle said the board had appointed Schneider with the long-term orientation of the company in nutrition, health and wellness and full the integration of its health science and skin health divisions in mind.   Continued...

A Swiss flag loats on the headquarters of world food giant Nestle in Vevey, Switzerland April 16, 2016. REUTERS/Denis Balibouse