As announced on 15th August 2007, Nestlé's Board of Directors approved a new CHF 25 billion Share Buy-Back programme to be completed over the next three years, subject to market conditions and strategic opportunities.

This decision takes into account the strong momentum, improving capital efficiency and future prospects of the Food and Beverages business, which is increasingly benefiting from the move towards nutrition, health and wellness. Furthermore, the recent acquisitions of Novartis Medical Nutrition and Gerber create critical mass in Nutrition, with annualised sales of over CHF 10 billion. Therefore, while the Board continues to believe that driving the performance of the Food and Beverages business offers the greatest opportunity for value creation within Nestlé, it takes the view that a significant Share Buy-Back programme should further enhance shareholder value. The scale of the Buy-Back programme is in line with Nestlé’s financial management objectives, which aim to retain flexibility.

Share Buy-Backs of Nestlé shares are carried out on a second trading line on SWX Europe, with Nestlé as the exclusive buyer on this line.

A shareholder wishing to sell Nestlé registered shares has the option of selling either via the ordinary trading line or via the second line. Shares purchased on the second trading line are subject to the Swiss federal withholding tax rate of 35 percent on the difference between the repurchase price of the Nestlé registered share and its nominal value of CHF 1.–. This withholding tax can be reclaimed by qualified investors.