By Svea Herbst-Bayliss
NEW YORK (Reuters) -Billionaire investor Daniel Loeb’s hedge fund Third Level is constructing a stake in Kenvue, sources aware of the matter mentioned on Friday, as some traders are pushing for strategic adjustments on the client healthcare firm.
Information of Third Level’s funding within the $44 billion Summit, New Jersey-headquartered maker of Band-Aids and Tylenol helped push its share value up greater than 2% in late afternoon buying and selling on Friday earlier than giving up some positive factors to shut at $23.01.
Kenvue, spun out of Johnson & Johnson two years in the past, has confronted strain from activist traders for months and averted a full-blown proxy combat with Starboard Worth in March when it added the agency’s founder and chief government, Jeffrey Smith, to its board.
Starboard pressed the corporate to overview the way it positions its manufacturers and the way they’re priced with a view to increase its efficiency.
Since reaching its settlement with Starboard, Kenvue has confronted strain from Toms Capital Funding Administration, one other activist agency that additionally constructed a stake and needs the corporate to think about strategic alternate options together with a attainable sale of your entire firm or parts of it, sources aware of the agency’s engagement mentioned.
It couldn’t be established how giant Third Level’s funding is or whether or not the hedge fund has engaged with Kenvue’s board or administration. A consultant for Third Level declined to remark. The Monetary Occasions first reported Third Level’s stake in Kenvue on Friday.
Kenvue mentioned it repeatedly engages with its traders however doesn’t touch upon particular person investor discussions. The board acts “in the very best pursuits of the corporate and all Kenvue shareholders and we stay centered on accelerating sustainable, worthwhile development and enhancing shareholder worth,” the corporate mentioned in a press release.
Whereas Kenvue’s manufacturers, together with Aveeno, Listerine and Zyrtec, are well-known, web gross sales have been flat at $15.5 billion in 2024. The corporate’s inventory value, whereas up 8% this 12 months, has slid 13.2% since being listed as a publicly traded firm in Might, 2022.
Third Level pursues quite a lot of methods together with, sometimes, activism during which it engages with administration to push firms together with Advance Auto Components, Walt Disney and Tub & Physique Works to carry out higher.
It oversees roughly $12 billion in property and returned 25% in 2024, a dramatic improve from a achieve of roughly 4% in 2023 and a 22% loss in 2022. Final 12 months, the agency rotated into client discretionary, monetary and industrial firms that helped gasoline returns after a post-election rally.
(Reporting by Svea Herbst-Bayliss; Extra reporting by Sriparna Roy in Bangalore; Enhancing by Will Dunham)
