Activist hedge fund Trian is building a stake in Unilever


Nelson Peltz activist hedge fund Trian Partners has built a stake in Unilever, stepping up pressure on FTSE 100 following its failed search for GlaxoSmithKline’s consumer health business.

People who know the matter directly told the FT that the $ 8.5 billion New York-based hedge fund has taken a position in shares of the British group, adding to the challenges of CEO Alan Jope.

The head of Unilever is already facing shareholder discontent after trying to take over GSK’s £ 50bn business. He now has to contend with a fierce activist fund known for demanding strategic and corporate change from companies.

People who know the stake building did not give details about its size or when exactly it started.

The revelation comes after a tumultuous week for Unilever in which it was forced to agree to shareholder demands to end its pursuit of GSK’s consumer health business after three failed bids.

An uprising of investors last week led to a drop in the price of a share of Unilever by as much as 11 percent. He recouped part of the losses after the company said it would no longer raise its bid.

Attention was shifted to the performance of Jope, who for three years was the CEO of a company best known for brands such as Dove Soap and Hellmann Mayonnaise.

Investors have urged him to achieve better results, but he must now do so with a shareholder base that has signaled its caution around using the deal to redirect the company’s assets towards higher-growth products.

Excluding dividends, shares of Unilever – the third largest company in the UK with a market capitalization of £ 94 billion – fell 17.7 per cent last year and rose only 13.7 per cent in the last five years.

Unilever marks the latest position in the consumer goods sector for Trian, founded in 2005 by Peltz, Ed Garden and Peter May. He previously targeted groups including Mondelez International, Procter & Gamble and Sysco.

Peltz left the P&G board last year, four years after gaining a stake and fighting over strategy. P&G shares rose about 85 percent during that time, and the U.S. group simplified its 2018 business structure.

Unilever has signaled it could also be willing to simplify, promising this week to unveil a new “operational model that will encourage greater agility”.

Trian and Unilever declined to comment.

In a scathing post-mortem of Unilever’s failed bids for GSK Consumer Health, Terry Smith’s top 15 investors attacked the company’s long-term results last week, adding: activity. What could go wrong?”

Last year, analyst Bruno Monteyne of Bernstein identified Unilever as a potential next project for Peltz, saying: “There are parallels with PepsiCo, where it (unsuccessfully) tried to force the separation of snacks and drinks in business.

“Some might argue that Unilever would benefit from the sale of its food and refreshment department and its low-rise categories.”

Although Peltz’s campaigns have not always been successful, he has helped shape some of the largest companies in the consumer sector. He failed to persuade PepsiCo to buy Oreo from Mondelez, but he played a role in Kraft’s acquisition of Cadbury and the subsequent spin-off of chocolate makers and other brands of Mondelez-shaped snacks.


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