market folly

Nelson Peltz's investment firm Trian Fund Management today filed an amended 13F filing with the SEC for the fourth quarter of 2012.  This filing, detailing positions as of December 31st, 2012 now shows that Trian had positions in Mondelez International (MDLZ) and PepsiCo (PEP) at the end of the year.

According to the filing, Trian's position in MDLZ totaled 19,415,193 shares at the time.  Their stake in PEP consisted of 3,932,663 shares.


Mondelez (MDLZ) Stake

It is extremely likely that this is not a new position for Trian and here's why:  Mondelez is a product of the Kraft split up into Kraft Foods (KRFT) and MDLZ in Q4.  Peltz's firm had been an owner of the old Kraft entity (old ticker KFT) back in the third quarter of 2012 per their 13F from that quarter.  KFT split up into KRFT and MDLZ on October 1st, 2012.

Trian's original 13F filing from the end of December did not show a stake in either entity, so many assumed that Trian had sold completely out of anything Kraft related in the fourth quarter.  However, their 13F also indicated that "confidential information has been omitted" from the filing and was filed separately with the SEC.

Fast forward to today when they file an amended 13F and all of a sudden a stake in Mondelez shows up again.  It then becomes clear that MDLZ (as well as PEP) were the confidential positions.  

As such, Trian most likely never sold MDLZ after they received shares from the Kraft spin-off and we assume they just didn't disclose the stake in their public 13F, but filed the position separately with the SEC.  While there's a chance they could have just bought shares in the open market post-spin, that seems less likely given their past ownership of the old Kraft entity pre-spin.

This week, we also highlighted that Bill Ackman's Pershing Square also filed an amended 13F from Q4 and also revealed a Mondelez position.  Also, hedge fund Scout Capital reported a large MDLZ stake at that time as well.


New PepsiCo (PEP) Stake: Seeking to Merge Companies?

Trian's position in Pepsi, on the other hand, is a brand new stake as they previously did not own any shares.  The Daily Telegraph has speculated that Peltz might potentially have plans to attempt to merge the two companies together.

At the same time, the piece mentions that Peltz could pursue activism with PepsiCo alone, potentially pushing them to split-up just like the old Kraft entity did. 

At the time the Telegraph piece was originally published, it was rumored that Trian had taken stakes in the companies.  And today, we get confirmation of those rumors via SEC filing.  We'll have to wait and see if Peltz has any activist tricks up his sleeve.