* Third Point continuing dialogue with Nestle - source
* Board appears not keen on L‘Oreal stake sale - sources
* Nestle shares pare gains made in wake of Loeb letter (Updates with details of Nestle campaign)
By Martinne Geller and Maiya Keidan
LONDON, July 10 (Reuters) - Activist investor Dan Loeb is keeping up pressure on Nestle by sharing views with the company as part of a regular dialogue, a source familiar with the matter told Reuters.
Loeb’s Third Point hedge fund revealed a $3.5 billion stake in Nestle on June 25, making it the eighth-largest shareholder, urging the world’s largest packaged food maker to more aggressively improve returns.
Three days later, Nestle addressed some of the New York-based fund’s points with a 20 billion Swiss franc ($21 billion) share buyback coupled with a plan to increase leverage and prioritise acquisitions in some high-growth areas.
Loeb met Nestle CEO Mark Schneider on June 2, the source said on Monday, adding that no other meetings were currently planned before a Sept. 26 investor seminar by the Swiss maker of Nescafe, Perrier and Gerber baby food.
Third Point generally agrees with the direction Nestle is heading in under Schneider, the first outside CEO in nearly a century, said the source, who declined to be identified.
But it wants to see the company act with greater urgency, including by setting a margin growth target like peers including Unilever and Danone have recently done.
Loeb’s Ultra fund, which is invested in Nestle, is doing well this year. It gained 0.9 percent in June, taking its year-to-date performance to 17.2 percent, said the source.
Nestle has not publicly addressed Loeb’s call for it to sell its 23 percent stake in French cosmetics giant L‘Oreal , which is worth about 23 billion euros ($26 billion).
But behind closed doors, Nestle’s board does not seem keen to divest the stake, which it has owned for more than four decades, the source said, confirming what other sources have previously told Reuters.
Third Point, which has not yet commented publicly on Nestle’s plans, may give an update in its quarterly letter to shareholders due later this month, the source said, adding that its current plan of campaign was to keep sharing its views and talking to the company.
Last month, Third Point said that it owned roughly 40 million Nestle shares in its funds and a special purpose vehicle raised especially for the move on the company.
It started buying Nestle shares earlier this year when the stock was trading above 70 Swiss francs per share, the source said. The shares jumped 4 percent to a record high the day Third Point’s letter was disclosed, but have since pared much of those gains. The stock was trading at 83.05 francs per share at 1012 GMT on Monday, up 1.5 percent. ($1 = 0.8785 euros) (Editing by Alexander Smith)