Nelson Peltz of Trian Fund Management had interesting ideas to share about PepsiCo, Inc. (NYSE:PEP) which he discussed while speaking at the Delivering Alpha conference, in the segment Alpha Agitator. According to HSBC Hedge Weekly, Trian Partners Ltd has taken a 11.8% gain through the first half of the year, although the event driven strategy was down 2.6% in June.
Peltz’ Huge Stake In Du Pont
During his speech Peltz talked about his stake in E I Du Pont De Nemours And Co (NYSE:DD), saying that Trian has amassed a large position in the company. However, he did not want to continue talking about DuPont when Andrew Ross Sorkin broached the subject. E I Du Pont De Nemours and Co (NYSE:DD) rose +5% in trading on the favorable mention from Peltz. Du Pont is a big name in the paint industry, additionally the company is also involved in agriculture and biotech sectors. Michael Karsch of Karsch Capital has been bearish on Du Pont, saying that among its peers Du Pont does not have the capacity to profit from increased supply of raw materials.
Pepsi and Mondelez Disease
While discussing PepsiCo, Inc. (NYSE:PEP), Peltz said that the problem is not with management, it is with the company’s structure. Peltz thinks that acquiring Mondelez International Inc (NASDAQ:MDLZ) would be a great buy, and he estimates Mondelez to be worth $35-38/share. Reports of Peltz contemplating the merger spread about three months ago.
Peltz said that Pepsi should spin off its underperforming beverage business whether it acquires Mondelez International Inc (NASDAQ:MDLZ) or it doesn’t. He also joked about the name Mondelez, said that it sounds like a disease, like if one has a case of Mondelez. He made more fun of the name by saying that, “Mondelez is a horrible name, costs at least 2 points on stock’s PE.” Mondelez rose over 3.8% on these encouraging comments from Peltz.
Peltz said that he is good friends with PepsiCo, Inc. (NYSE:PEP)’s CEO Indra Nooyi and has meetings planned with the company over the next weeks.
Stay tuned for Larry Robbins, Steve Kuhn and Carl Icahn at Delivering Alpha.
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Full Nelson Peltz Presentation Via Market Folly, also check out his great coverage from today.