THE mere mention of Nelson Peltz’s name is enough to send a shiver down a boardroom’s collective spine. The hard-hitting hedgie can claim responsibility for the break-up of Cadbury Schweppes, a big restructuring at Legg Mason and for shaking out the waste within State Street.
Once he builds a stake in a firm big enough to declare, he tends to move quickly to push for change.
As yesterday’s announcement showed, traders pile into the targeted firm in the hope he will whip a firm into shape – even if, as in IHG’s case, his intentions are not obvious.
The news of his $150m stake in PepsiCo last November caused its shares to jerk up three per cent in the hopes of an overhaul, only for Peltz to dispose of his stake just three days afterward.
But when he does stick around, the New York native’s aggressive tactics have generated handsome profits for investors in his Trian Partners fund, which returned a reported 7.02 per cent net of fees last year.
He is known to use a strategy of “operational activism,” getting involved in the day-to-day running of the firms in order to knock them into shape.
He sold his first firm, Triangle Industries, for $4.2bn in 1988, and went on to agitate for change at a string of fast food groups including Wendy’s and Snapple.
The married father of 10 is worth $1.1bn, according to Forbes magazine. He dropped out of Wharton business school at the University of Pennsylvania in the 1960s.