US investment firm Trian Fund Management, which is headed by activist investor Nelson Peltz, has acquired 1% stake in Danone - the French dairy company which is estimated to have a market capitalization of approximately $37bn.
Trian Fund Management will seek to improve Danone's margins, especially in the bottled water business, but will not pursue management shakeup, sale or breakup, reported the Wall Street Journal quoting a person familiar with the matter.
Trian Fund Management said that Danone shares are undervalued, and having a leaner cost structure and avoiding dilutive mergers can lead to significant shareholder value.
Earlier, the investment firm pushed for the shakeup of management at H.J. Heinz Co. It also backed the split of Kraft Foods into two publicly traded companies - one focusing on the snacks business, and the other on its North American grocery business.
Danone, based in Paris, France, has four divisions Fresh Dairy Products, Waters, Baby Nutrition, and Medical Nutrition. It operates primarily in France, Russia, Spain, Germany, the UK, China, Indonesia, Mexico, Argentina, and the US.
