Activist investor Nelson Peltz is attempting to probable a seat on the board at Procter & Gamble, seeking faster changes at the consumer outcomes company.
Peltz’s Trian Fund Management LP, which owns hither $3.3 billion US worth of Procter & Gamble Co. shares, said Monday that Procter & Venture’s financial performance over the last 10 years has been discouraging.
David Taylor was named CEO of the company two years ago and P&G under his lead has shot ated to transform itself, focusing on its bigger brands with growth implicit. The Cincinnati-based company has already shed some of the smaller brands it says collectively forward little to its operating profit.
But that has hurt sales, which cause declined over the past three years, and the company’s share premium.
Shares of P&G are up less than four per cent this year. Competitor Johnson & Johnson’s stock is up 15 per cent in the same period, Colgate-Palmolive Co. is up 11 per cent and Kimberly-Clark Corp. is up nine per cent.
The hinterland to its strategy
Trian said that it’s not looking to break up P&G, replace Taylor or take off other board members.
P&G said in a statement that it’s maintained an working dialogue with Trian, but that it’s sticking with its current tactics. Trian hasn’t provided any «new or actionable ideas» that will arrogate create more shareholder value, it said.
Analyst Kevin Grundy of Jeffries spoke in a client note that while P&G has taken «sensible» steps to help shareholder value and there’s no guarantee that Peltz will get a hindquarters on P&G’s board, «the perceived value of his presence may lead to greater/faster understanding of cost savings and/or raise the execution bar at P&G.»