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Campbell Soup sale could be on the cards
Posted on Friday, 10 August 2018 14:40
Campbells Soup may be about to go on the block after shareholders Daniel Loeb and George Strawbridge recommended a strategic review, which could lead to a divestment of the business, should it take place.

The pair, who own a combined 8.4 per cent stake in the New York-listed firm, believe undertaking the process could generate value for investors.

For its part, Campbell affirmed its dedication to achieving good returns for shareholders and will publicise its plans for the future later this month.

In a filing with the Securities and Exchange Commission, Strawbridge said the company’s flawed strategic plan has resulted in a reduction of the company’s value and weakened the business considerably.

He noted that he has raised the issues with the board on a number of occasions, but the directors disagreed with the potential strategic alternatives put forward by the investor and have since refused to engage in meaningful discussion on the matter.

Strawbridge concluded by saying that if a strategic review does not result in a change of direction, the board should be reconstituted.

Loeb’s Third Point Capital echoed these sentiments in a statement of its own.

Following the two filings, shares in Campbell jumped 0.7 per cent to finish the day at USD 42.28 on 9th August, thereby valuing the business at USD 12.71 billion.

The company posted a net loss of USD 393.00 million for the three months to 29th April 2018, compared to net earnings of USD 176.00 million over the corresponding timeframe in 2017.

If a sale of Campbell went ahead at its market value of USD 12.71 billion, it would be the largest purchase of a food manufacturer to have been announced this year, according to Zephyr, the M&A database published by Bureau van Dijk.

The most valuable such transaction to have been signed off in 2018 to date is worth USD 10.90 billion and involved Conagra Brands picking up Pinnacle Foods.

© Zephus Ltd