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Chick-News.com Poultry Industry News, Comments and more by Simon M. Shane

TreeHouse Foods Reaches Agreement with Jana Partners

03/08/2021

In mid-February EGG-NEWS reported on the dispute between Jana Partners LLC, an investor, and the management of TreeHouse Foods.  In accordance with a March 2nd agreement, Jana will nominate two directors to the Board and the companies have agreed to end mutually pejorative comments.

 

Steven T. Oakland, President and CEO of TreeHouse, stated “We share a common perspective with Jana that our current share price does not reflect the progress that we have made and the value of our opportunities, business and outlook.  I look forward to working with Jana and the rest of the Board to focus on accelerating our momentum and achieving a stock price that reflects the true value of our business.”

 

Barry Rosenstein, Managing Partner of Jana, added “We are encouraged by the steps the company has been taking including these director additions and by the ongoing commitment to unlock stockholder value.” 

 

Jana Partners has disclosed a 7.4 percent equity position and has urged a strategic review of the company including a potential sale.  Jana previously motivated the sale of Pinnacle Foods to Conagra Brands in 2018 and was involved in the sale of Whole Foods Market to Amazon.com.

 

TreeHouse Foods has a market capitalization of $2.95 billion. Shares have traded over the past 52-weeks in a range of $33.50 to $53.98 with a 50-day moving average of $45.98.  TreeHouse shares are regarded as overvalued and trade with a forward P/E of 17.6. As of February 12th       12 percent of the float was short. On a trailing 12-month basis, operating margin was 6.8 percent and the profit margin 0.3 percent. Return on assets attained 3.5 percent but return on equity was 2.7 percent hence the concern of investors.


 
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