Unilever’s share price has risen after the consumer goods company announced that the billionaire activist investor Nelson Peltz is to become a board member.
Peltz, the US founder and chief executive of Trian Fund Management, has been building his Unilever stake since January amid growing speculation that he will push the Dove soap and Marmite manufacturer to shake up its sprawling operations, with the company under increasing pressure to sell off brands or consider a break-up.
His $7.4bn (£5.9bn) investment firm has previously mounted activist campaigns at Unilever’s rivals, including Procter & Gamble, Heinz and Mondelēz. He joined the board of each company but has now relinquished these roles.
Peltz made headlines beyond the business sector last month when his daughter, Nicola Peltz, married Brooklyn Beckham, the son of David and Victoria Beckham, in a lavish ceremony at the billionaire’s 27-bedroom Florida mansion, Montsorrel.
Unilever said on Tuesday that Trian Fund Management controls 37.4m Unilever shares, or about 1.5% of the company, as it announced his appointment as a non-executive director.
Investors responded positively and Unilever shares rose bymore than 7% to £37.45 in early trading, making it the biggest riser on the FTSE 100. This pushed up the company’s share price from a five-year low in March.
Last month, the asset manager AllianceBernstein called for a root and branch shake-up.
The AllianceBernstein analyst Bruno Monteyne said Unilever should be split into smaller, “more cohesive” businesses, such as home care, personal care and beauty, and food.
Peltz’s investment has added to the pressure on chief executive, Alan Jope.
The company has been under fire after years of poor returns for shareholders: the company’s share price did not benefit from the stock market rally during the recovery from Covid lockdowns.
It was dealt a further blow in January – shortly before Peltz revealed his stake – when the British pharmaceutical company GlaxoSmithKline refused a £50bn offer for its rival consumer health products arm, instead choosing to proceed with a spin-out listing on the London Stock Exchange.
Peltz will also serve on Unilever’s compensation committee when his appointment becomes effective on 20 July, giving him a direct say on directors’ pay, including Jope’s.
Peltz was the heir to his family’s food business, which he joined in 1963, growing it and making investments in a long line of companies including a packaging maker to the Snapple drinks brand as well as PepsiCo, General Electric and the British investment firm Janus Henderson. He is chairman of the fast food chain Wendy’s.
He has also used his wealth (estimated at $1.6bn by Forbes) to intervene in politics and was a Donald Trump supporter, holding a fundraising dinner for his 2020 presidential re-election campaign at Montsorrel where tickets cost more than $580,000 a pair, according to the Washington Post.
However, Peltz said he was “sorry” for voting for Trump after the January 6 riot in Capitol Hill by the former president’s supporters last year.
Last month he was reported to have hosted a fundraising event at his Florida home for Joe Manchin, the conservative Democratic senator who blocked President Joe Biden’s Build Back Better domestic spending plan.
In a statement provided by Unilever, Peltz said: “We believe [Unilever] is a company with significant potential, through leveraging its portfolio of strong consumer brands and its geographical footprint.
“Trian has made a considerable investment in Unilever. We look forward to working collaboratively with management and the board to help drive Unilever’s strategy, operations, sustainability, and shareholder value for the benefit of all stakeholders.”
