Nelson Peltz, the activist investor who founded Trian Partners, said a company indicates how poorly it is performing by the severity of its opposition to outsiders. He has struggled to get a seat on the board of consumer packaged goods giant Procter & Gamble.
"I believe that there is a direct correlation between how poorly a company is doing and how big of a fight they put up," Peltz said at CNBC's Net/Net Summit in New York City.
As an activist fund, Trian buys a significant interest in a company and then pushes for changes in the board of directors. The idea is to unlock shareholder value by demanding changes in business strategies or management.
Trian has a roughly $3.5 billion stake in P&G, which has some of the best-known brands on store shelves, such as Pampers diapers, Tide detergent and Crest toothpaste.
Peltz is pushing for P&G to reorganize, contending it’s been slow to come up with innovative products and suffers from a bloated structure.
But P&G, the largest company in history to face a proxy fight, has resisted his efforts. Peltz once estimated that the company has spent more than $100 million in its fight against him.
P&G this month said that shareholders rejected Peltz's bid for a seat on the company's board. Peltz has not conceded the vote and an official count could take weeks, CNBC reported.
"I think it got ugly one sided. I think that all we dealt with was facts," Peltz said. P&G CEO David Taylor "was available to talk at all times. The problem was they didn't want me in the inner sanctum. They didn't want me to have the real numbers."
Taylor has a different recollection of Peltz.
“He’s never asked virtually anything,” Taylor told Bloomberg News last month. “He hasn’t asked about strategy, people, what we’re doing.”
Taylor said Peltz’s criticisms are based on dated information, and called P&G a “profoundly different company” than it was a few years ago.
“We’ve certainly been willing to listen to him,” he said of Peltz. “What he hasn’t returned is a genuine interest to understand the transformation the company’s going through.”
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