Nestle SA (NSRGY) - Get Report   opened firmly higher Wednesday after the world's biggest food company said it would buyback around $21 billion in shares over the next three years following criticism from the U.S. hedge fund Third Point LLC and indicated it may look at acquisitions in key growth areas.

Nestle said it launched a program to increase shareholder returns earlier this year which included a "comprehensive review" of its capital structure and priorities. The review, the company said, determined that capital spending should focus on high-growth sectors such as coffee, petcare, infant nutrition and bottled water as well as consumer healthcare. It also said it would "continue to assess opportunities for margin improvement" through selective cost-cutting.

"In the context of low interest rates and strong cash flow generation, share buybacks offer a viable option to create shareholder value," Nestle said in a statement. "Therefore, as a result of its review, the Board of Directors approved a share buyback program of up to Sfr20 billion ($20.8 billion), to be completed by the end of June 2020. Should any sizeable acquisitions take place during this period, the share buyback program will be adapted accordingly."

Nestle shares gained 1.25% in the opening 45 minutes of trading in Zurich to change hands at Sfr85.35 each, extending their two-day gain past 3.8%. 

Nestle shares hit a record high of Sfr86 Monday after Third Point revealed it had built a 1% stake in Nestle, which would put the group among the ten largest shareholders of the Vevy, Switzerland-based group and said it wants management to pursue a series of options it argues would unlock shareholder value, including the sale of its 23% stake in luxury goods maker L'Oreal SA (LRLCY)

"Despite having arguably the best positioned portfolio in the consumer packaged goods industry, Nestle shares have significantly underperformed most of their U.S. and European consumer staples," Third Point said in a letter to investors. "It is rare to find a business of Nestle's quality with so many avenues for improvement."