Activist investor Nelson Peltz has joined the board of consumer goods group Unilever, sending shares in the group up 7 per cent in early trading on Tuesday.
The maker of Magnum ice cream and Dove soap said that Peltz, who runs Trian Fund Management, would join as a non-executive director on July 20 and also become a member of the group’s compensation committee.
The Financial Times reported in January that Peltz’s $8.5bn fund had taken a position in the UK company following its aborted attempts to acquire GlaxoSmithKline’s consumer health division.
Unilever disclosed on Tuesday that Trian holds a 1.5 per cent stake, making it the group’s fourth-largest shareholder, according to data from Refinitiv.
Peltz’s elevation to the board is the latest in a series of interventions in the consumer goods sector by the activist investor. He has previously been on the boards of Procter & Gamble, Heinz and Mondelez.
Trian had made a “considerable investment” in Unilever, Peltz said, adding that he was looking forward to “working collaboratively” with the group’s management.
“We believe it is a company with significant potential, through leveraging its portfolio of strong consumer brands and its geographical footprint,” Peltz said.
Other Unilever shareholders have grown increasingly disillusioned with the lacklustre performance of the group, which makes food and household products. Before the jump early on Tuesday, Unilever shares had lost 16 per cent since chief executive Alan Jope took over in 2019.
Several large shareholders were also unhappy with Unilever’s attempts late last year to buy GlaxoSmithKline’s consumer health division, soon to be spun off under the name Haleon, for £50bn.
Peltz, meanwhile, stepped down from the board of Procter & Gamble last year, four years after he had acquired a $3bn stake in the company.
James Edwardes Jones, analyst at RBC Capital Markets, said: “At P&G, we believe Nelson Peltz stimulated changes to culture, remuneration and organisational structure. Although he isn’t completely responsible for the much-improved company P&G is today, he was a factor.
“We hope his presence can motivate similar changes at Unilever as well as drive cross-investor engagement.”
Unilever announced in January that it would restructure the company into five divisions and cut about 1,500 jobs following news of Peltz’s stake. It has also been facing a steep rise in costs.
Nils Andersen, chair of Unilever, said: “We have held extensive and constructive discussions with him and the Trian team and believe that Nelson’s experience in the global consumer goods industry will be of value to Unilever.”
