“As of last night, Pershing has bought only 3% of Mondelez’ stock directly”, reports Geoffrey Smith in Fortune.
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Activist investor William A Ackman has amassed a $5.5-billion stake in Mondelez worldwide, which makes Oreo cookies and Cadbury chocolate, in anticipation of the food company becoming a target of industry consolidation, The Wall Street Journal.
Investors had expected Mondelez to be the star of the two companies that resulted-a growth engine driven by sales of snacks in developing markets such as Brazil and Russian Federation.
Pershing Square was an investor in Cadbury when Kraft launched a hostile bid for the chocolate maker in 2009 and Ms Rosenfeld, then chief executive of Kraft, stoked controversy in the UK by backing away from an apparent promise not to close Cadbury factories, according to ficancial Times. During the split, Mondelez took many packaged foods brands like Ritz, Triscuits and Nabisco, while Kraft Foods retained refrigerated foods brands like Polly-O cheese and Oscar Mayer meats.
But they also point out “Mondelez and other U.S. food groups have been grappling with a revolution in tastes at home, where consumers are embracing healthier eating habits and more natural ingredients”.
“We’ll continue to focus on executing our strategy and on delivering value for all shareholders”, she said in an emailed statement.
“I think it’s not a pure investment looking for organic growth”.
Some analysts mentioned newly formed Kraft Heinz Co (KHC.O) or PepsiCo Inc (PEP.N) as potential buyers.
While a tie-up with Kraft Heinz could be seen as an about-face for Mondelez, the theory is that Kraft’s new management, 3G, brings a more aggressive focus on costs. Alexia Howard told CNBC’s “Squak Box” this morning.
In June, Ackman took a 22-per cent stake in Nomad Holdings Ltd, a so-called special-purpose acquisition company, or SPAC. Heinz’ owners, Warren Buffett’s Berkshire Hathaway and the Brazilian investment firm 3G Capital, engineered the deal.
Activists, who buy shares and push for changes they believe will boost the stock price such as breakups, buybacks and cost cuts, have gathered larger war chests in recent years on the back of growing successes.
NEW YORK (AP) – Activist investor Bill Ackman is paying approximately $5.5 billion for a 7.5 percent stake in snack maker Mondelez worldwide Inc.
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Shares of Deerfield, Ill.-based Mondelez were up 0.50% at $46.52 in midday trading Thursday after the announcement by Ackman’s Pershing Square Capital Management L.P. In April, Peltz had said he was not interested in pushing the company for a big deal and wanted it to continue improving its profit margin, sales and market share.
