Blog: Chris Brook-CarterWater under the bridge

Chris Brook-Carter | 29 June 2004

As the deadline approaches for reaching an agreement with unions for around 1,000 job cuts at Nestle's unprofitable Perrier plant in France, the company's threats to sell off the water brand look increasingly weak.

Speculation has mounted recently, that Nestle would look to sell the brand if it cannot settle the row with unions at the plant. Nestle set a deadline of tomorrow to resolve the matter.

In the Wall Street Journal Europe yesterday, a number of analysts suggested that Nestle would find selling the brand harder than it thinks.

Rene Weber, analyst at Bank Vontobel, told the newspaper that he is confident the two parties will eventually resolve the conflict. “I still believe there will be an agreement. The unions have to be aware that any other solution, such as a sale to a third party, could hurt even more,” he said.

Nestle can't simply close the plant, because of the power of French unions and the nature of the business - a mineral-water plant is dependent on a well and can't be moved, analyst Patrick Hasenboehler at Bank Sarasin told the journal.

Selling Perrier to a financial investor might be a possibility, Hasenboehler said. However, a protracted struggle is the most likely scenario, he added. “I think it's entirely possible that Nestle continues to muddle through until some sort of solution appears.”

Although Nestle has said that it is a priority to reach an agreement before the summer holidays, the company has indicated it may extend the deadline beyond tomorrow if there is progress in the negotiations.


BLOG

Normal service to resume on Tuesday

It's a bank holiday here in the UK on Monday (25 August). just-drinks' team will be taking a well-earned lie down. ...

BLOG

Will Russia ban bear fruit for Polish cider?

Poland is hardly noted for its cider consumption, but all this could be about to change. ...

BLOG

"Sell me more, sell me mo[CLICK]" - The Riesling Greasling

Here's a brave move by the folk from Camerata at Paulie's in Houston: a wine-related parody of Summer Nights from Grease....

BLOG

The just-drinks Weekly Round-Up

Here's a round-up of the top stories on just-drinks last week, featuring The Coca-Cola Co and Monster Beverage Corp, Constellation Brands, Anheuser-Busch InBev and Australia's wine producers....

just-drinks homepage



Forgot your password?