Trian Fund Management, led by activist investor Nelson Peltz, has accumulated massive stakes in PepsiCo, Inc. (NYSE:PEP) and Mondelez International Inc (NASDAQ:MDLZ). In a Securities and Exchange filing Friday, Trian Fund said that it started building stakes in both the food giants in late 2012, and increased its stake to $269 million in PepsiCo, Inc. (NYSE:PEP) and $494 million in Mondelez International by the end of December 2012.
However, sources familiar with the matter told CNBC that the activist investor’s stakes were much larger. Over the past few months, Trial Fund has increased its stake to $1.3 billion in Mondelez International Inc (NASDAQ:MDLZ) and $1.4 billion in PepsiCo, Inc. (NYSE:PEP), said the sources.
Carlson Capital's Black Diamond Arbitrage Partners fund added 1.3% net fees in the first quarter of 2021, according to a copy of the firm's March 2021 investor update, which ValueWalk has been able to review. Q1 2021 hedge fund letters, conferences and more At the end of the quarter, merger arbitrage investments represented 89% of Read More
Earlier, there were reports that the billionaire investor could push for a marriage between the snack giants. The longtime activist may also seek a position on the board of directors of both companies. Nelson Peltz has a history of pushing for mergers and spinoffs at other companies. For example, he pushed Cadbury Schweppes in 2008 to divide its candy business from the weak beverage unit which later became Dr Pepper Snapple Group Inc. (NYSE:DPS).
Analysts speculate that he may push PepsiCo, Inc. (NYSE:PEP) to spin off its Frito Lay business and merge it with Mondelez International Inc (NASDAQ:MDLZ). Mondelez International was the snacks division of Kraft Foods Group Inc (NASDAQ:KRFT), but was spun off last year. The current Mondelez International Inc (NASDAQ:MDLZ)chief executive officer Irene Rosenfeld used to run Frito Lay.
Earlier Friday, PepsiCo, Inc. (NYSE:PEP) said in a statement that the company held several meetings with Trial Fund Management in the past few weeks to consider the fund’s initiatives and ideas for long-term growth. Trian Fund’s disclosures come at a crucial time. PepsiCo., which owns popular brands like Tropicana, Quaker Oats and Frito Lay, is evaluating various restructuring options, including a spinoff, to revive its declining North American beverage business. If that happens, analysts argue that PepsiCo would like to acquire another snack food company to maintain its current size.
PepsiCo, Inc. (NYSE:PEP) shares were up 2.01 percent to $82.88, while Mondelez International Inc (NASDAQ:MDLZ) shares jumped 1.99 percent to $30.70 at 10:22 AM EDT.