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Morning Brief: JANA Partners Discloses Newest Potential Activist Target

The hedge fund firm has set its sights on Bloomin’ Brands, the owner of Outback Steakhouse.

  • By Stephen Taub

JANA Partners has identified its newest activist target. Shares of Bloomin’ Brands, the owner of Outback Steakhouse and other restaurant chains, surged 12.4 percent, to close at $20.54, after the hedge fund firm headed by Barry Rosenstein disclosed it owns 8.74 percent of the shares. The filing was made jointly with Glenn Murphy, the founder and CEO of FIS-Holdings, a consumer-focused investment firm that invests in undervalued businesses, and Neal Yanofsky, an investor and consultant to restaurant companies and private equity investors. Murphy bought 150,000 shares, or 0.16 percent of the total, while Yanofsky bought 5,000 shares.

In the filing, JANA said it bought the shares because it deems them to be undervalued and that the company represents an attractive investment opportunity, typical language in these types of filings. It also said it intends to hold discussions with the board of directors and management on a number of topics, including strategic alternatives. This includes exploring a sale of the company. Given the two individuals recruited for this effort already, this investment should most likely become a little testier in future weeks or months. JANA did not disclose a position in the stock in its most recent 13F filing covering third-quarter holdings. In the 13D, JANA shows that it started building its position on October 4. This is not a coincidence. As we have illustrated in the past, JANA is one of many of the high-profile activists who carefully avoid publicly telegraphing their next activist target.

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ValueAct Capital bought an additional 1.34 million shares or so of Trinity Industries, boosting its stake in the industrial conglomerate to 12.3 percent. So far, the activist hedge fund firm has not publicly communicated any proposal or plan regarding the company. However, it is known for holding extensive discussions with managements and boards of directors behind the scenes, often arriving at an amicable plan. The stock rose 0.20 percent, to $33.70. The stock is up more than 21 percent this year.

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Tiger Management led the $120 million Series D financing of Yunmanman, a freight transportation and logistics mobile app operator in China, according to chinamoneynetwork.com, citing Chinese media reports. It is also sometimes described as an app for Uber-like truck services.

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Shares of hedge fund favorite Amazon.com slipped less than 1 percent, to $1,126.31, even though Nomura Instinet raised its price target from $1,100 to $1,360, according to CNBC. Nomura, which maintained its buy rating on the stock, reportedly said the e-commerce giant will be able to maintain its leadership position because it is able to invest aggressively. “With nearly all retailers playing defense, the few willing & able to go on the offensive have been digging ever increasing moats to take ever increasing share,” analyst Simeon Siegel said in a note to clients, according to CNBC.

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