That escalated quickly.
A little more than two weeks since activist investor group Jana Partners disclosed a stake in Whole Foods, the Austin, Texas-based natural/organic retailer has seen its market value rocket by $1.7 billion, analysts argue for takeovers by conventional rivals and one rumored deal (Albertsons-Sprouts) replaced by an even bigger combination (Albertsons-Whole Foods).
Led by Barry Rosenstein, Jana Partners describes itself as “a value-oriented investment advisor specializing in event-driven investing.” It typically buys shares in companies it believes are undervalued and where it anticipates change, and influences the boards of those companies to adopt measures Jana feels will increase shareholder value. In cases where Jana and its target company disagree, Jana will move to replace some or all of the board of directors with its own candidates. A source familiar with Jana described this, however, as a “nuclear option” and a “last resort,” saying most often Jana’s objectives have been achieved though talks with executives and board members.
Following is a closer look at five ways the Jana-Whole Foods story has already affected the supermarket industry.