The chief executive of Cadbury Schweppes is confident he has the support of the group's major shareholders despite activist investor Nelson Peltz increasing his stake in the company.
Todd Stitzer yesterday said he was sure the majority of the shareholders backed his strategy for the group.
Mr Peltz and his investment vehicle Trian Fund Management, in conjunction with the Qatar Investment Authority, increased its stake in the Bournville company to 4.5 per cent on Monday, prompting rumours that he was trying to exert fresh influence over the group.
Mr Peltz, who also has stakes in Heinz and Kraft Foods, has pushed aggressively for changes at both companies and has a place on the board of Heinz. Analysts predict he may now be trying the same at Cadbury. Mr Stitzer countered the move yesterday, saying Cadbury was such a vibrant company he was not surprised by people wanting to invest in it. "People looking for value from an investment are interested in our company, so the news from Mr Peltz and his associates was not a surprise," said Mr Stitzer.
However, he declined to give details of the Cadbury board's recent communication with Mr Peltz.
Since his stake has been built through derivatives, Mr Peltz is under no obligation to disclose his holding to Cadbury although he is believed to have told the company informally.
Mr Stitzer said: "We don't describe the contact we have with investors. We have conversations with a number of major investors on a normal basis."
Mr Peltz is widely seen as the man behind the decision by Cadbury earlier this year to separate its confectionery and US beverages divisions - even though the firm's management has always vigorously denied this. The corporate raider, together with others, has also been blamed for the closure of the Cadbury plant at Keynsham, near Bristol, and shifting production to Poland.
Regarding current strategy, Mr Stitzer said Cadbury remained on track to complete the demerger of the confectionery and drinks divisions by the second quarter of next year and revealed that following the split, the beverages division would be renamed Dr Pepper Snapple Group.
Cadbury had originally pursued a straight sale of the business but the plans were scrapped when the global credit crunch forced interested private equity parties to drop their interest.
Mr Stitzer would not completely rule out a sale should interest be revived between now and the timing of the demerger.
"I hate to be a prognosticator for the credit markets but we are focused on a demerger," he said. He also declined to comment on continuing speculation regarding a possible merger of the confectionery business with Hershey, the largest US chocolate maker.
In a trading statement yesterday, Cadbury said it expected 2007 confectionery revenue growth to be ahead of its target range of four-to-six per cent, driven by continued strong sales momentum.
The group also expects modest margin improvement from the confectionery division this year and said cost reduction and pricing actions are proceeding to plan.
Cadbury said its chocolate business in Britain had recovered market share in recent months, benefiting from the re-launch of Wispa, marketing investment behind Dairy Milk including the 'gorilla' TV adverts, and a positive start to the critical Christmas period.
In addition, it said the gum market in Britain, where it launched the Trident brand earlier this year, had continued to grow strongly while South Africa was "having another excellent year with strong growth in chocolate and gum".