This excerpt taken from the HNZ DEFA14A filed Jun 28, 2006.
Heinz believes that Mr. Peltzs recent involvement with CBRL Group demonstrates a self-interested and short-term view.
During the fourth quarter of 2005, Mr. Peltz quietly acquired a 4.9% interest in Cracker Barrels parent company, CBRL Group. In the first quarter of 2006, following apparent pressure from Mr. Peltz, CBRL announced strategic initiatives including a significant leveraging of the balance sheet through a Dutch auction share repurchase. CBRL completed the Dutch auction in May 2006, repurchasing about 35% of its outstanding shares at $42 per share. CBRL incurred significant new debt and its credit rating was lowered as a result.
From SEC filings and financial industry reports, it is evident that Mr. Peltz sold his entire stake in CBRL by the end of the first quarter of 2006 after less than six months as a shareholder, at a likely substantial profit for himself.
Today, CBRL shares trade at levels similar to those before Mr. Peltzs involvement and the company now carries a substantial new debt load.