Analysis - Is Nelson Peltz eyeing a fresh PepsiCo coup bid?
PepsiCo rejected Peltz's proposal
The so-called "activist investor" Nelson Peltz has already had a huge bearing on the last 12 months at PepsiCo. That's the length of time since he went public with his wish to merge the US group maker with Mondelez as well hive off PepsiCo's snacks from its beverages.
PepsiCo may have thought it had deflected Peltz's ambition when he first dropped his push for the Mondelez merge and later was told categorically by PepsiCo CEO Indra Nooyi and CFO Hugh Johnston that the company will remain a single entity.
Well, according to analysts Stifel, PepsiCo was wrong. Stifel, who recently met with Peltz and his Trian Fund Management team, came away with the impression that far from being put off by Nooyi and Johnston's entrenchment, Peltz has been “inspired”. The rebuff, Stifel said, came from just two members of the board, suggesting that there are 11 others waiting to be influenced.
Stifel now thinks Peltz will step up his demands for PepsiCo to show evidence that staying as a single unit (the company's “Power of One” strategy) is better for shareholders than splitting snacks and drinks.
The analysts also think that Peltz and his team are ready to agitate for new board elections. Even just one new director coming in would be “a major victory” for Trian because it would give them a better shot at “changing the dialogue in PepsiCo’s board room”, Stifel said.
That outcome may still be some way off, but one thing is for sure - PepsiCo has yet to see the back of Peltz.
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