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Cramer's 'Mad Money' Recap: Break Up to Make Up

03/28/07 - 07:39 PM EDT

TheStreet.com Staff

Click here for an archive of Cramer's "Mad Money" recaps.


Nelson Peltz has been the "catalyst shareholder" at both Heinz HNZ and Cadbury Schweppes CSG, Jim Cramer told viewers of his "Mad Money" TV show Wednesday.

Peltz has given tips to both companies, and they have listened, Cramer said. On March 15, Cadbury announced that it was splitting in two. Cramer offered up the next two companies he believes should follow in its footsteps.

Breaking up is not hard to do -- just look at American Standard ASD, where CEO Frederic Poses "created instant value," he said.

There are two companies here that Cramer likes: Clorox CLX and ConAgra Foods CAG. With private-equity firms everywhere, "even in tired, old brands," Cramer believes that any breakup could put a company in play.

Plus, the combination of Clorox's products is "something that makes no sense whatsoever," Cramer said. It makes charcoal and salad dressing -- two businesses that have nothing in common.

ConAgra is another company that has "ailing brands," he said. "It is currently conceived as making a sandwich out of too many ingredients" and needs to be split up.

Both companies, Cramer said, "are in the sweet spot of value creation." They could wake up tomorrow and break into two, three or four companies, or sell their underperforming divisions to "hungry" private-equity firms, he said.

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At the time of publication, Cramer was long Altria, Toyota Motor, NYSE Group, Sears, Goldman Sachs and Caterpillar.

Jim Cramer, host of the CNBC television program "Mad Money," is a Markets Commentator for TheStreet.com, Inc., and CNBC, and a director and co-founder of TheStreet.com. All opinions expressed by Mr. Cramer on "Mad Money" are his own and do not reflect the opinions of TheStreet.com or its affiliates, or CNBC, NBC UNIVERSAL or their parent company or affiliates. Mr. Cramer's opinions are based upon information he considers to be reliable, but neither TheStreet.com, nor CNBC, nor either of their affiliates and/or subsidiaries warrant its completeness or accuracy, and it should not be relied upon as such. Mr. Cramer's statements are based on his opinions at the time statements are made, and are subject to change without notice. No part of Mr. Cramer's compensation from CNBC or TheStreet.com is related to the specific opinions expressed by him on "Mad Money."

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