| NEW YORK
NEW YORK Nov 7 Activist investor Nelson Peltz
has taken a stake of roughly 1 percent in Danone,
saying the French food group is undervalued and should implement
cost cuts and other operational measures to improve its stock
The world's largest yogurt maker is expected to post an
operating margin of only 14.1 percent this year, below other
large food companies' average margins, which are in the
mid-to-high teens, Peltz's Trian Fund Management L.P. said in a
statement on Wednesday.
"Trian believes Danone`s shares currently trade at a
significant discount to intrinsic value and that targeted
strategies to improve performance, such as a leaner cost
structure and refraining from dilutive mergers, could generate
significant shareholder value," said the investment firm headed
Trian believes Danone's stock has the potential to rise more
than 60 percent to 78 euros by the end of 2014, and expects to
engage in "constructive dialogue" with management, the
investment firm said.
A Danone spokeswoman said earlier on Wednesday that the
company had not been informed by Peltz or his fund that he had
crossed the threshold of 0.5 percent of the company's stock.
Peltz, who often wrestles with management at companies he
considers undervalued or poorly managed, i s also famous for
being instrumental in the break-up of Britain's Cadbury,
building a stake in Cadbury Schweppes and pushing it into a
decision to demerge in 2007. After the split, Cadbury was taken
over by Kraft in 2010.