(Reuters) - Activist investor Nelson Peltz is seeking a seat on Procter & Gamble Co's PG.N board, taking public his frustrations with the company's lagging stock price and railing against its "suffocating bureaucracy."

Trian Fund Management LP on Monday announced the nomination of its chief executive and co-founder Peltz, launching the largest proxy fight ever against a $223 billion consumer products juggernaut that sells everything from Tide detergent and Gillette razors to Pampers diapers.

Peltz’s nomination comes after five months of behind-the-scenes discussions between Trian and P&G’s top executives and board, according to the company’s proxy filing. At one point, the two sides nearly struck a truce in May that would involve P&G laying out certain performance metrics over the next year.

But any sign of an agreement was absent on Monday when both came out swinging. The 180-year-old company, founded on a hand-shake agreement by a soap and a candle maker, issued a statement strongly backing its board and strategic plan. See Breakingviews column:

Trian, which owns about $3.3 billion of P&G’s stock, or 1.5 percent of the company, has until an October annual meeting to convince fellow shareholders that Peltz deserves to be voted onto the board.

The firm’s campaign website (revitalizepg.com) and press release has few immediate changes proposed for the company other than advocating for a geographic organizational structure that it believes will empower divisional leaders to make faster and better decisions.

Shares of P&G were up slightly at $87.72 in afternoon trade.

Trian's previous battle with a consumer goods conglomerate was with PepsiCo Inc PEP.N, where it pressured the company to spin off its beverage business from its snacks division, a campaign that the company never heeded though it did hand the investor a board seat in 2015 to make peace. (reut.rs/2uvu0ea)

That campaign began with Trian advocating Peltz for Pepsi’s board and ended with industry veteran William Johnson joining as Trian’s representative.

In a CNBC interview on Monday, Peltz, 75, talked more about Trian’s track record with companies such as H.J. Heinz than actual operational changes needed at P&G. Peltz railed against the company’s “suffocating bureaucracy,” but noted he was on good terms with CEO David Taylor.

Trian said it wants P&G to cut costs more efficiently, and that it does not want to replace Taylor, any board directors, or to break-up the company.

FILE PHOTO - Nelson Peltz speaks at the WSJD Live conference in Laguna Beach, California October 25, 2016. REUTERS/Mike Blake

Since Taylor became CEO in November, 2015, P&G's stock has gained 0.3 percent. In contrast, the S&P 500 Household Products index .SPLRCPROD, which includes Kimberly-Clark Corp KMB.N and Clorox Co CLX.N, has risen 12 percent over the same period.

P&G’s quarterly organic sales, which excludes acquisitions and divestitures, has fallen just once during his one and half years at the helm. For this year, the consumer goods giant expects a 2-3 percent rise in organic sales growth.

BATTLE LINES

The Trian-P&G battle comes as activist investors, emboldened by years of successful campaigns for changes at corporations across the U.S. and abroad, use their growing coffers to seek bigger targets. Trian won two seats on H.J. Heinz's board in its 2006 proxy fight, and lost its battle to get board representation at industrial conglomerate DuPont DD.N in 2015.

P&G’s proxy filing, disclosed on Monday, shows that Trian’s dialogue with the company goes back to Feb. 16, when Peltz called Taylor shortly after disclosing the stake to make the introduction and set up an in-person meeting.

“I am quite surprised and very disappointed because I think David (Taylor) and I have developed a very positive relationship,” Peltz told CNBC, when asked if he was surprised that the dialogue had turned into a proxy fight. “I like the man.”

Trian said in a press release that its bid to get Peltz on the board centers on P&G's continuing underperformance, costs, complexity and culture. (bit.ly/2t7h62c)

OCTOBER ANNUAL MEETING

With P&G’s annual meeting usually held in October, the two sides have roughly three months to discuss ways to avoid a shareholder vote on Peltz. If elected, Trian has said it wants P&G to expand the board to 12 members rather than have Peltz replace a sitting director.

P&G’s current board has six past or current CEOs, including American Express CEO Kenneth Chenault and Hewlett Packard Enterprise CEO Meg Whitman.

“P&G has a best-in-class board of directors that is fully supportive of and actively engaged in overseeing the company’s transformation,” the company said on Monday.

P&G’s proxy filing noted that last Tuesday, in a meeting between Trian and members of P&G’s board, Trian said it was moving ahead to elect Peltz because the company was not moving fast enough to improve its performance.

P&G directors at the meeting said they too were not happy with the performance, but that they felt that Trian’s representation on the board was unnecessary in light of recent initiatives undertaken by the company,” the filing said.

In a bid to boost profits even as sales remain stagnant, P&G has sold unprofitable brands, including 41 beauty brands to Coty Inc COTY.N, and focused on core brands.

However, the efforts have failed to boost the stock much beyond the level where it traded at the beginning of this year.

Trian said that P&G’s last cost-cutting plan, launched in 2012, failed to impact profit or sales growth.

Barclays noted on Monday that Trian is working with former P&G CFO Clayt Daley, a consultant on the campaign who could become a potential board candidate to replace Peltz as part of the negotiations.