Published: Wed, April 12, 2017
Economy | By Melissa Porter

Whole Foods' activist battle sets up a clash of foodie gurus

In the filing Jana said it and the other named investors "collectively possess significant operational, financial and nutritional expertise, including, for some of the other reporting persons, experience creating significant shareholder value in the food and grocery sectors".

With its newly acquired stake, valued at $721 million, Jana Partners says it wants to reevaluate Whole Foods from top to bottom - analyzing everything from its real estate selection to senior management and store-level execution. Looking at this figure it suggests that the shares of Whole Foods Market, Inc. These investors - including former grocery analyst Meredith Adler, former Harris Teeter CEO Tad Dickson and former Gap CEO Glenn Murphy - have signed with Jana as potential board nominees for election at Whole Foods' 2018 annual meeting.

The scope of Jana's investment reflects investors' frustration with Whole Foods underperformance after years of stellar growth.

"Just like the conventional supermarkets are trying their very best to keep their customers from eroding to Whole Foods Market, we're going to do the best job that we can to keep our core customers from migrating back over to those guys", Mr. Mackey said during a February 8 earnings call.

The investment firm announced the holding in a filing on Monday, saying it would seek talks with management and push for a review of Whole Foods' strategic alternatives.

In early trading Tuesday, Whole Foods shares were up almost 10 percent at $34.17.

The supermarket chain, which helped pioneer the organic-food movement, has been grappling with its worst sales slump in more than a decade. The firm's quarterly revenue was up 1.8% compared to the same quarter previous year. Six straight quarters of declining same-store sales have forced the company to close stores and rein in costs. That's likely a signal that Jana, which has quietly reached settlements with several companies this year to install new directors, will be aggressive in demanding change at Whole Foods.

The Austin, Texas-based company said on Monday that it is "open to the views and opinions" of its investors.

With this team of experts scrutinizing Whole Foods, Mackey is under more pressure to shape up the company quickly.

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