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Hard Shareholder Value Activist Investor Strategic Options M&A

Activist Action

#CPG
ProHub Comment

This case tests candidates' ability to balance competing objectives between activist investors (seeking short-term stock appreciation) and company management (seeking long-term sustainable growth). The case requires both quantitative financial analysis (NPV calculations, valuation multiples) and qualitative strategic reasoning about which divestitures and operational changes are realistic and sustainable.

Estimated Time 15 minutes
Difficulty Hard
Source Duke
50 / 100
Your client is a large CPG company with multiple business units including snacks, beauty, and home (cleaning) products. Your client is under pressure from a high-profile activist investor that has built a 7% stake in the company. The client has asked you to help predict the new investors likely demands that could increase stock price or company performance. What are your ideas to deliver short-term and long-term value back to the shareholder?

Clarifying Information

  1. Large business in North America. The client operates in ~70 countries.
  2. Revenue: Snacks $19B, Beauty $31B, Home $29B; EBITDA: $24B - Target Savings: $10B
  3. This investor likely has influence on the board and cannot be ignored.