Peltz's Trian Takes Stake in Sysco

Nelson Peltz's Trian Fund Management LP disclosed Friday that it has taken a 7.08% stake in Sysco Corp., saying the food-and-supplies distributor has underperformed.

The stake makes Trian the largest shareholder in Sysco, according to FactSet data.

In a regulatory filing, Trian said it has met with Sysco's chief executive and chairman about ways to enhance the company's value, including by increasing capital returned to shareholders and better aligning compensation with the company's performance.

Trian said it has also discussed board representation with the company. Trian, which has gained board seats at companies including Mondelez International Inc. and Bank of New York Mellon Corp., said it expects to have further discussions with Sysco.

Trian said it expects to have further discussions with Sysco.

In a statement, Sysco confirmed that Trian has taken a "significant" stake in the company.

"We welcome collaborative discussions with investors who share our interest in creating value by marketing and delivering great products and services to our customers with exceptional service," the company said. "We cannot speculate on Trian's intentions or future actions."

Sysco shares, up about 4.5% this year, gained 7.7% in afternoon trading.

Houston-based Sysco, the nation's largest distributor of food and other supplies to restaurants and cafeterias, has been piecing together a new growth strategy after dropping its $3.5 billion plan to buy US Foods, following a June ruling by a federal judge effectively blocking the deal on antitrust grounds.

Chief Executive Bill DeLaney said earlier this month that Sysco has shifted its focus to smaller acquisitions, internal cost-cutting and updating its product assortment and technology to compete with rivals that have more natural and organic items and better online ordering.

Earlier this month, Sysco reported a drop a 71% drop in profit for its latest quarter, hurt by charges stemming from the abandoned plan to acquire US Foods.

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