Undaunted by repeated knock backs from the firm's board and management, PepsiCo's outspoken activist shareholder and Mondelez board member continues to agitate for the company to split its food and beverage arms into separate businesses.
Following a terse letter from PepsiCo on February 19 criticizing his plan, Peltz hit the warpath again last Thursday with another lengthy letter to the PepsiCo board criticizing its “dismissive tone” apropos his proposals and reliance on “platitudes and rhetoric” to support Indra Nooyi's ‘Power of One’ strategy.
"We believe that if management stays on the current path and delivers the promised high single digit EPS growth over the next few years without another reset, they will materially weaken (and perhaps even destroy) the North American Beverage business because they will have done it by not competing on innovation, speed and price, thereby losing market share to Coke," Peltz says.
Repetition is a common verbal device used to drive home a point, and (rather ironically given his attack on Pepsi’s board for ‘rhetoric’ and his mastery of the medium) Peltz uses it to effect in this new March 13 letter to savage PepsiCo’s beverage business, which he insists is underinvested and underperforming.
Given his belief that PepsiCo should adopt a ‘disruptive’ marketplace position vis-à-vis Coke, some of Peltz’ phrasing reminds me of Black Rebel Motorcycle Club’s raucous tune ‘Whatever Happened to my Rock ‘n’ Roll?’.