This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Activist Investor to Shake Up Dr Pepper

Stocks in this article: DPS CBY

NEW YORK (AP) -- Billionaire activist investor Nelson Peltz is pledging to get more involved in Dr Pepper Snapple Group (DPS) to fine-tune its operations and boost the beverage company's stock price, even if it means nominating new directors to the board and taking other actions.

Peltz, through his Trian Fund Management L.P. investment firm in New York, disclosed that his entities collectively hold 18.2 million shares, or a 7.18% stake, in Dr Pepper, according to a Friday filing with the Securities and Exchange Commission.

Trian's stake includes 10.8 million shares, or 4.26% of Dr Pepper, represented by swaps. Trian entered into swaps with Merrill Lynch International from October 2007 to March 2008 at prices of $24.24 to $24.75. Some swaps expire next June, and the rest expire in 2010.

By the settlement date of the swaps -- either at expiration or earlier termination -- Trian must pay up if there is "negative price performance" compared to an agreed-upon benchmark and vice versa. Payment must be in cash and not company shares. The swap shares also carry no direct or indirect voting rights.

Trian said that since Dr Pepper was spun off from Cadbury Schweppes Plc (CBY) and became publicly traded in May, total shareholder return has been negative 40.7%. In contrast, the S&P 500's beverages index was down 12.6%, and its consumer staples index fell 15.2%. On Friday, Dr Pepper closed at $16.96, up 21 cents, but down 44% from its 52-week high of $30.

Trian said it has met with Dr Pepper's executives and board of directors to address its concerns. The investment group said Dr Pepper is seen by Wall Street more as a beverage bottler than a branded beverage company even if it owns its most important brands.

1 of 2

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!


DOW 17,778.15 +421.28 2.43%
S&P 500 2,061.23 +48.34 2.40%
NASDAQ 4,748.3960 +104.0840 2.24%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs