The Morning Brief: Jana Partners Scores with TeamHealth Deal

Score this as a victory of sorts for activist hedge fund firm Jana Partners. One of its activist targets, TeamHealth Holdings, agreed to be acquired by Blackstone Group for $6.1 billion in cash. TeamHealth, a physician services organization, said in a press release that the deal represents a 33 percent premium over its closing share price on October 3, noting this was the last trading day prior to news reports that TeamHealth was considering a possible sale of the company. In the press release, TeamHealth points out that New York-based Jana agreed to vote its shares for the deal. The hedge fund owns about 8 percent of the outstanding shares. In late February Jana disclosed its 8 percent stake and submitted three nominees to the company’s board of directors. Shares of TeamHealth Monday closed up about 16 percent, to nearly $43.

“We are pleased to reach this agreement with Blackstone, which maximizes value for all TeamHealth stockholders,” said Leif Murphy, president and chief executive officer of TeamHealth, in the press release.

Jana initially paid between roughly $34 and $45 per share for its stake, so the deal price is toward the high end of what Jana paid for the shares but much higher than what it paid for a significant slice of the stake. However, shareholders of TeamHealth must still be frustrated. After all, in October 2015 the company rejected an unsolicited acquisition offer from AmSurg Corp., which valued the stock at the time at $71.47 per share. Two weeks later AmSurg withdrew its offer. The deal with Blackstone also includes a “go-shop” period, which means TeamHealth and its board can still look for a better deal during a 40-day period.


Eddie Lampert has personally purchased nearly 400,000 shares of Sears Hometown and Outlet Stores for a little less than $5 per share. Altogether, he and his hedge fund firm, ESL Investments, own more than 12 million shares, or 53 percent, of the home appliance and gardening supplies chain that was spun off from Sears Holdings in 2012.


E. Lee Hennessee-Gradante, a hedge fund pioneer who has headed her New York hedge fund advisory firm since the 1980s, was found dead over the weekend at her condo in West Palm Beach, Florida. She apparently suffered a stroke, according to the Palm Beach Post, citing a family spokesman. According to the police, the death is not considered suspicious. Hennessee’s southern accent reflected her North Carolina roots; she was friends with Julian Robertson Jr. and Louis Bacon, two hedge fund icons who hailed from the same state.

She launched Hennessee Hedge Fund Advisory Group in 1987 as a division of Shearson Lehman Brothers/American Express, helping clients make direct investments in hedge funds. That year she created The Hennessee Hedge Fund Index, one of the first hedge fund indexes. In 1995, her husband Charles Gradante joined the firm, serving as president and CEO. In 1997, Hennessee and Gradante formed Hennessee Group as an independent firm. In 2013 it was acquired by Terrapin Asset Management.