Heinz Prepares for Peltz Board Shake-up

12 September 2006

PITTSBURGH: Activist shareholder Nelson Peltz claims he has won a significant victory in his battle to gain seats on the board of iconic ketchup maker HJ Heinz.

Billionaire Peltz says preliminary results of a proxy vote show he and fellow investor Michael Weinstein have been elected, although official results are expected to be announced Friday.

He has been trying to gain board seats since March, urging the food manufacturing giant to cut $575 million (€452m; £308m) in costs, increase marketing and sell assets to increase its share price [WARC News: 08-Mar-06].

Heinz ceo William Johnson believes the Peltz plan would cripple the company and has responded with his own restructuring strategy, including spending reductions of $355m and 100 new product launches next year.

The presence of the two activists on the board will ratchet up pressure on Johnson, although the company is putting a brave spin on the situation.

Says spokesman Michael Mullen: "We are confident that the board of directors will support the company's plan to enhance shareholder value and drive our business momentum."

Data sourced from Financial Times online; additional content by WARC staff