Investor Ackman takes $5.5-billion stake in Oreo, Ritz maker

Activist investor Bill Ackman is paying approximately $5.5 billion for a 7.5 percent stake in snack maker Mondelez International Inc.

Ackman's Pershing Square Capital Management LP is buying about 120.3 million shares of the Deerfield, Illinois-based company. He hasn't yet said what, if anything, he intends to urge the maker of Oreo cookies and Cadbury chocolate to do, but the stake raised the possibility of further deal-making among big packaged food makers.


Mondelez's stock rose more than 5 percent in Thursday premarket trading.

Ackman is not the only activist investor with a stake in Mondelez. Nelson Peltz's Trian Fund Management LP holds a 3.1 percent stake in the company, according to FactSet. Peltz is a Mondelez board member.

Mondelez, the maker of products including Oreo cookies, Trident gum and Cadbury chocolate, split off from Kraft in 2012. Kraft kept the North American grocery brands and Mondelez took the snacks.

Kraft has combined with H.J. Heinz to form The Kraft Heinz Co., creating one of the world's biggest food companies with brands such as Jell-O, Oscar Mayer, Velveeta, Ore-Ida and their namesakes. Heinz' owners, Warren Buffett's Berkshire Hathaway and the Brazilian investment firm 3G Capital, engineered the deal.

In May, Buffett said during an appearance on CNBC that Coca-Cola, Heinz and other companies will respond to a shift in the U.S. to healthier foods, but predicted that the appetite for longtime favorites made by Kraft and Heinz will not fade. Berkshire Hathaway is also the biggest shareholder in Coca-Cola.

Last month Mondelez posted better-than-expected second-quarter earnings because of lower costs. CEO Irene Rosenfeld said in a statement at the time that the company would use the savings to increase investments in marketing, sales and capacity expansion to speed up revenue growth and improve market share.

Many large food companies have been cutting costs to offset slower growth or put savings back into marketing in an effort to boost sales. These businesses are also trying to keep pace with the changing tastes of shoppers who are demanding food they see as healthier or more natural and have been tweaking their product lineups to reflect that.