Blog: Peltz takes another bite out of Cadbury
Dean Best | 10 December 2007
A single shareholder upping its stake in a business by just 0.8% may not usually be considered newsworthy.
But, when that shareholder is activist investor Nelson Peltz and the company concerned is confectionery giant Cadbury Schweppes, it’s enough to perk the interest of financial hacks on both sides of the Atlantic.
The news today that Peltz has increased its stake in Cadbury to 4.5% lends further weight to the speculation that he is keeping up the pressure on the UK business to improve its financial performance.
A certain amount of intrigue surrounds just how much influence Peltz has had at Cadbury and at two of his more high-profile investments in the US, Kraft Foods and Heinz.
However, Heinz has looked rejuvenated this year and Kraft has been busy restructuring its business to improve margins, so investors in Cadbury will be hoping that the perceived pressure from Peltz will boost their returns in the months ahead.
Investors will also be looking for positive signs about Cadbury’s performance when it announces a trading update to the market tomorrow (11 December).
Cadbury seems to have had a buoyant autumn, particularly in the UK, where details of its recent performance, were made public in a leaked memo.
While investors may be cheered by more good news tomorrow, workers affected by the company’s planned cuts in the UK are sure to be less than pleased.
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