H. J. Heinz & Company (2006-2013)
The H. J. Heinz Company (“Heinz”) is a global food manufacturing company. Heinz merged with Kraft Foods in 2015, becoming The Kraft Heinz Company.
Trian acquired stock in Heinz in early 2006 with a set of initiatives to reduce annual costs, deploy a more efficient capital structure and increase focus on key brands and geographies. Despite a world-class brand and strong cash flow, Heinz’s total shareholder returns had underperformed for almost a decade due to failed restructurings, rising sales general & administrative (“SG&A”) costs, weak marketing and poor capital allocation.
In 2006, Trian engaged in its first of only three proxy contests since inception and, with the support of Heinz’s large institutional investors, won two seats on the Board of Directors (including one for Nelson Peltz who served on the board from 2006 until 2013) and began working with management and the board to execute on Trian’s value creation initiatives. During the period in which Trian was invested in Heinz, the company generated several significant changes, including a 25% increase in net revenue, a substantial increase in marketing spending, and 30 consecutive quarters or organic sales growth.
By December 2012, Trian had substantially harvested its investment in Heinz. In June 2013, Berkshire Hathaway and 3G Capital completed the acquisition of Heinz, a transaction valued at $28 billion, which at the time was the largest ever in the food industry. Nelson Peltz served on the special committee of the board that negotiated this acquisition.
Company Website: http://www.kraftheinzcompany.com/