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Activist Investor Nelson Peltz Buys Back Into Kraft

Tuesday, 28 Jun 2011 | 10:38 AM ET

If at first you succeed, why not try again. That seems to be the thinking of activist investor Nelson Peltz, who has recently purchased 12.2 million shares in Kraft Foods, a stock he has trafficked in frequently over the last four years, usually with good results.

Nelson Peltz
AP
Nelson Peltz

To be sure, 12.2 million shares is a pittance for a company with 1.7 billion shares outstanding, and nothing suggests at this point that Peltz will seek to mount an activist assault on the consumer products giant.

But I can tell you that Kraft has noted his new holdings (as of the end of March) and is monitoring the situation.

It’s unclear whether Peltz is in Kraft for a trade (he’s already up nicely) or will hang around and increase his position through the summer to gird for another battle.

Peltz has not returned my calls.

It was four years ago that Peltz took a roughly 3 percent position in Kraft (a story broken by yours truly) and used the threat of a proxy fight to win two board seats from the company—they were added to increase the board to 11 seats.

Since then Kraft has made a huge acquisition of Cadbury and watched its stock price perform fairly well (it’s up in line with the Standard & Poor's 500 over the last year and a bit ahead of the consumer staples group).

Kraft also counts activist investor Bill Ackman amongst its shareholders.


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