US: Nelson Peltz Reportedly Ready For Proxy Battle With P&G

Activist investor Nelson Peltz is reportedly preparing for a proxy battle with Procter & Gamble, in a move aimed at getting the world’s largest FMCG maker to shake up its operations.

According to the Wall Street Journal, the Trian Fund Management firm is looking to get P&G to give Peltz a seat on the group’s board of directors.  The report, which cited unnamed sources, said Trian will put forward the proposal as a shareholder vote at the group’s AGM, likely in October 2017.

The report added that P&G has already rejected a demand from Trian, which holds a roughly 1.5% stake in the manufacturer, to make Peltz a director.  The sources told the WSJ that Trian is not looking to break up the group, and if it wins the board seat, will renominate whoever loses (thus expanding the board).

The report went on to say that both sides are in agreement over some moves that P&G should undertake, such as lowering costs and restructuring its management set-up.  However, Trian says the group is not moving fast enough, and Peltz recently told the paper: “We need a game-changing attitude at P&G. We just can’t keep going along the same path.”

P&G did not comment on the board speculation, simply noting: “The Board is confident that the changes being made are producing results, and expresses complete support for the Company’s strategy, plans, and management.”

NAM Implications:
  • The same changes, but faster…
  • Time was when being a supplier was just about brand equity.