Billionaire Nelson Peltz Hopes for Soft Drink Alpha
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Mondelez is the number one global seller of biscuits, chocolate, candy, and powdered beverages. The company also has the number two position in gum and coffee. The deal would make the combined company one of the world's leading food companies.
However, worth noting is that PepsiCo is already the largest food and beverage company in North American and second in the world.
DuPont sold its auto and industrial paint business to The Carlyle Group back in February for $4.9 billion. Reading between the lines, if Peltz does have a DuPont position, could he be looking to further break it up? Just this week, DuPont announced that it could be looking to spinoff its performance chemicals segment.
The company has a variety of operations and is the second largest U.S. chemicals manufacturer. Its agricultural segment accounts for nearly 30% of sales, the nutrition and health segment is at 10%, industrial bio-sciences is 3.4%, electronic and communication technologies is 7.7%, performance chemicals at 20.4%, performance materials 18% and safety/protection 10.9%.
The cold and wet weather conditions in major farming states has pressured the company's agriculture and nutrition segments. The big tailwind for DuPont is its agriculture segment. Back in 2012, the company launched 154 new corn hybrid products and 33 new soybean varieties in North America.
One of the key initiatives for the company includes the move toward developing biotech-based approaches for food production. The urbanization of emerging markets will drive the increase in demand for the global farm economy, driven by corn seed and protection products.
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Marshall Hargrave owns shares of Mondelez International. The Motley Fool recommends PepsiCo. The Motley Fool owns shares of PepsiCo. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!