• by Thom Forbes  @tforbes, August 6, 2015

Another high-stakes, investor-driven food fight is developing at Mondelez, this one instigated by Bill Ackman’s Pershing Square Holdings disclosing late Wednesday that it has acquired a 7.5% position in the marketer of Oreos, through thick and Thins, as well as Ritz crackers, Nutter Butter, Cadbury and other familiar brand names in 165 countries worldwide. 

“Ackman, who has made bets on other food companies like McDonald’s, believes that Mondelez must increase its revenue and slash costs or put itself up for sale, said a person briefed on the investment but not authorized to speak publicly about it,” reports Alexandra Stevenson in the New York Times.

Things had just quieted down a bit at Mondelez after another activist investor, Nelson Peltz, dropped his pressure on the company to merge with Pepsico’s Frito-Lay when he was given a seat on the board 18 months ago.

In October 2012, Kraft Foods changed its name to Mondelez International at the same time that it completed the spin-off of its North American grocery business, known as Kraft Foods Group. 

“Investors had expected Mondelez to be the star of the two companies that resulted — a growth engine driven by sales of snacks in developing markets such as Brazil and Russia. Kraft was expected to be a more unremarkable performer,” writes Annie Gasparro for the Wall Street Journal.

“But coming out of the gate, Mondelez stumbled with pricing missteps and inventory buildups. [CEO Irene] Rosenfeld said at the time it was just a ‘speed bump.’ But the new company continued to hit bumps like that for more than a year, exacerbated by tapering economic growth and stiffer competition in emerging markets, which made up some 40% of its revenues.”

“We welcome Pershing Square as investors in our company,” Mondelez spokeswoman Valerie Moens said, Reuters’ Supriya Kurane reports. “We'll continue to focus on executing our strategy and on delivering value for all our shareholders.”

In an earlier story in the WSJ that broke the news of Ackman’s position in Mondelez, Gaspasso, David Benoit and Liz Hoffman suggest that Kraft Heinz — formed earlier this year — is one potential buyer of the company. In fact, it is one of the only entities that could afford the price. It has not commented on the reports thus far.

“It’s not clear how much Ackman spent to accumulate his position, which is built mainly on options and forward contracts. As of last night, Pershing has bought only 3% of Mondelez’ stock directly,” reports Geoffrey Smith in Fortune. “However, the position was worth some $5.5 billion at Wednesday’s closing price in New York, and Ackman is likely already sitting on a sizable profit on paper. Mondelez’ stock has risen by over a third since March….”

A source told CNBC that Pershing Square was considering a takeover of Mondelez but “further details were not immediately available,” according to a staff report.

“Hedge funds have been attracted to the food sector amid a wave of consolidation and a willingness by some of the sector’s biggest companies to radically cut costs to juice shareholder returns,” Stephen Foley and Lindsay Whipp write for Financial Times.

But they also point out “Mondelez and other U.S. food groups have been grappling with a revolution in tastes at home, where consumers are embracing healthier eating habits and more natural ingredients.”

Yet, investors’ appetite for high-calorie deals — be it in food, pharmaceuticals, apparel or retailing — seems insatiable at the moment.