KAI RYSSDAL: Corporate America doesn’t generally like to air its dirty laundry. Tries to keep all the infighting and backstabbing private. That hasn’t been working so well at Heinz. You could safely call what’s been happening a six-month street fight for control of the ketchup company.
Corporate raider turned activist shareholder Nelson Peltz controls the second largest stake in that company. And he wants more. Both Peltz and management have spent millions to get their way. But Marketplace’s Lisa Napoli says it’s not clear yet who’s won.
LISA NAPOLI: Proxy votes and annual meetings are rarely dramatic affairs. But when an iconic American brand like Heinz is at stake, things are different. Three times as many people crammed the Pittsburgh Hilton today as showed up for last year’s annual meeting.
Now the votes have to be counted — all 330 million of them. And it’ll be weeks before we know who won. Heinz spokesman Michael Mullen seems optimistic that the company’s slate will prevail over Nelson Peltz’s:
MICHAEL MULLEN: It’s possible they may get one or two, but they’re not going to get the five they were looking for, which is good news for Heinz.
The 130-year old company has been in the doldrums, but it thinks it can get back on track without Peltz. In June it announced a plan to restructure the company, buy back stock, and cut jobs.
Now, Peltz is already credited with shaping up companies like Wendy’s and Snapple. Simply by swaggering in and rattling the saber at Heinz, he’s had an effect: the stock’s gone up 20 percent. Some say Heinz shouldn’t take its control for granted.
Chris Young of Institutional Shareholder Services says the stakeholders he’s talked to seem to crave Peltz’s brand of creative dissent:
CHRIS YOUNG: He takes a stake in an underperforming company, sort of like a value investor would. Unlike a value investor, instead of waiting to look for improvement, he tries to force the issue and create the improvement sooner rather than later.
One improvement Peltz would like to see: better marketing of Heinz’s core brands. But in case he doesn’t win control, he’s not limiting his sights to ketchup and frozen french fries. Just this week, it came out he’s bought a stake in the troubled media giant, Tribune Company.
In Los Angeles, I’m Lisa Napoli for Marketplace.