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  "documentTitle": "PepsiCo (PEP)",
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  "authorName": "Nelson Peltz",
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  "presentationDate": "2014-02-19 00:00:00",
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      "text": "Separating snacks and beverages increases probability of a valuation multiple re-rating",
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      "text": "Prior to 2008, critics had said that Dr Pepper Snapple would struggle... management had significantly reduced corporate expense and begun a process of reinvesting in its brands (driving advertising and marketing from 6% of sales in 2008 to 8% of sales last year).",
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      "text": "In addition to the operating and cultural benefits of a separation, we strongly believe standalone snacks and beverage companies, positioned correctly to the market, will trade to a higher blended valuation multiple than PepsiCo trades at today.",
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      "text": "What happened to Dr Pepper Snapple's parent company, Cadbury? Standalone Cadbury management... delivered 28% annual EBIT growth and improved margins by 380 bps from 2007 through 2009.",
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      "text": "In 2013, Dr Pepper Snapple delivered 10% constant currency EPS growth. In 2014, Dr Pepper Snapple is guiding to 6-8% constant currency EPS growth.",
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      "text": "management promised the transactions would be accretive... PepsiCo was forced to conduct a major EPS re-set as beverage performance... had declined precipitously",
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      "text": "Dr Pepper Snapple Group. One of the primary reasons cited as to why snacks and beverages should not be separated is that a standalone PepsiCo beverage business cannot compete effectively against Coca-Cola. We disagree.",
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      "text": "management promised the transactions would be accretive, provide synergies that could be reinvested back in the brands and allow PepsiCo to “take to a whole new level our ‘Power of One’ program of bundled food and beverage offerings” — PepsiCo press release, 4/20/09",
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