UPDATE 1-Peltz's Trian reports 7.18 pct stake in Dr Pepper

NEW YORK Fri Dec 19, 2008 8:26am EST

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NEW YORK Dec 19 (Reuters) - An investment arm controlled by activist investor Nelson Peltz reported a 7.18 percent stake in Dr Pepper Snapple Group (DPS.N), saying the beverage company's shares were undervalued and represented an attractive investment opportunity.

Peltz's Trian Fund Management disclosed its stake in the company in a U.S. Securities and Exchange Commission filing on Friday.

Trian said in the filing that it had met with the board and management of Dr Pepper Snapple and relayed to them that investors see it as more of a beverage bottler than a branded beverage company.

"The Trian Group sees opportunities to create value at the issuer through sharper strategic focus, better operational execution and more efficient uses of capital," it said in the filing.

Depending on factors such as Dr Pepper Snapple's financial positions and share value, Trian said it could take steps like proposing nominees to the company's board.

London-based Cadbury CBRY.L moved to demerge Dr Pepper Snapple in October 2007 after Peltz pressured the group to split in March of that year. (Reporting by Aarthi Sivaraman; Editing by Lisa Von Ahn)

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