Activist investor Peltz joins Unilever board, will he agitate for a break-up?

By

Sandra Halliday

Published
Jun 1, 2022

Unilever's shares rose as much as 8% this week on news that the consumer products giant’s board has a new member — billionaire activist Nelson Peltz. He will join as a non-executive director in July.

He joins as pressure mounts on Unilever’s CEO to transform and even split up the business and focus more on share price growth rather than on social purpose. It’s an aim that may be desired by investors, but may also be at odds with what its increasingly sustainability- and social-good-focused customers want.

As well as being known as the chief executive of the New York hedge fund Trian Fund Management, Peltz also entered the wider consumer consciousness this year due to his daughter Nicola recently marrying Brooklyn Beckham.

Investors are hoping that his arrival means the owner of the Dove, Hourglass, Tatcha, Living Proof and Murad brands will be forced to overhaul its business that has seen sluggish growth in recent periods. Peltz is known for agitating for change and also did so at Procter & Gamble.

Of P&G, Peltz said it had “ageing brands and a lack of breakthrough innovation” and accused it of “suffocating bureaucracy and excessive costs”. That’s a view some expect he also holds about Unilever.

Trian holds only a 1.5% stake in Unilever, but given the massive market value of the firm (over £96 billion), that adds up to a hugely valuable holding and makes Trian the group’s fourth-largest shareholder.

Peltz said he believes Unilever is a company with “significant potential”. He added: “Trian has made a considerable investment in Unilever. We look forward to working collaboratively with management and the board to help drive Unilever’s strategy, operations, sustainability, and shareholder value for the benefit of all stakeholders.”