Campbell Soup can serve you better, hedgie tells investors
Billionaire investor Daniel Loeb is using his activist hedge fund to woo Campbell Soup shareholders, saying the “iconic asset” was an attractive prospect for takeover and claiming it could fetch $58 (£44.50) per share.
Loeb’s Third Point fund is pushing to replace all the food company’s directors, who it said had presided over “tenure of mismanagement, waste, ill-conceived strategy, and inept execution”.
In August, facing pressure from investors to put the whole business up for sale, Campbell said that it planned to sell off two of its divisions.
Read more: Investment fund Third Point plans to oust Campbell board
The company, whose signature tomato soup cans were made the subject of a famous Andy Warhol paintings, looked to flog its fresh refrigerated foods unit and its international business. It global business include brands such as Kettle Chips and Royal Dansk biscuit maker Kelsen.
Loeb is stepping up pressure on Campbell by taking his call for change directly to investors, ahead of an upcoming vote. He unveiled his ownership stake in August, calling for a sale of the company and urging it to divest more assets.
Descendants of John Dorrance – the billionaire businessman and heir to the company fortune, who ran Campbell a decade ago – are split in their loyalties, with some serving on Campbell's current board and one instead moving with Loeb and calling on investors to elect him alongside 11 others on Loeb's slate.
Read more: Campbell's Soup is splitting up and selling some of its divisions
Loeb said a dollar invested in Campbell 10 years ago would be worth $1.34 today, while a dollar invested in industry rival Hormel Foods at the same time would now be worth $16.37.
“The dismal stock performance is a report card on the Company’s leadership, which has made a series of blunders,” Loeb wrote in a letter to shareholders. “We believe the past year has been particularly disastrous.”