Blue Apron Rises on Jana Stake in Embattled Meal-Kit Maker

  • Sometimes-activist fund owned 2% of Blue Apron as of June 30
  • Jana also established new position in organic grocer Sprouts

Why Blue Apron Shares Are Plummeting

Shares of Blue Apron Holdings Inc. rose after Jana Partners disclosed a position in the embattled meal-kit delivery service.

Jana acquired 2 percent of Blue Apron as of June 30, the sometimes-activist hedge fund said in a regulatory filing Monday. Blue Apron’s shares have fallen almost 50 percent since their debut in June as the New York-based company struggles to persuade investors it can win the hearts of American cooks. It has spent heavily on marketing to educate consumers on the concept and distinguish itself from dozens of competitors.

A representative of Jana declined to comment on the holding.

Blue Apron shares rose as much as 5.3 percent after the stake was disclosed. The stock was up 3.1 percent to $5.28 as of 1:42 p.m. in New York.

Disappointing earnings last week spurred Goldman Sachs Group Inc., the lead underwriter on Blue Apron’s June 28 initial public offering, to downgrade the stock to the equivalent of a hold.

Sprouts Market

Jana, which reaped a $300 million windfall after selling its Whole Foods Market Inc. stake, stuck to groceries in the second quarter with new positions in Blue Apron and organic grocer Sprouts Farmers Market Inc.

The hedge fund, founded by billionaire Barry Rosenstein, said in Monday’s filing that it owns about 593,000 shares of Sprouts. The grocer held preliminary talks this year to be taken private by Cerberus Capital Management and merged with that firm’s Albertsons Cos. brand, people familiar with the matter said at the time.

Jana also reported new positions in companies including First Data Corp., Molina Healthcare Inc. and DXC Technology Co. It sold its holdings in Willis Towers Watson Plc, Computer Sciences Corp. and Aetna Inc., among others.

Jana exited its entire Whole Foods position after Inc. agreed in June to acquire the company for $13.7 billion. With Whole Foods shares boosted by Amazon’s premium, Jana Partners -- within a matter of months -- pocketed about $300 million on its investment in the grocer. At the end of June it still held 23.3 million shares in the company, Monday’s filing showed.

New York-based Jana has also taken a 5.8 percent position in natural gas driller EQT Corp. and is pushing that company to scrap its $6.7 billion takeover of Rice Energy Inc. It wants EQT to instead pursue a spinoff of its pipeline business.

The firm also has active positions in medical equipment manufacturer Zimmer Biomet Holdings Inc., bio-pharmaceutical company Bristol-Myers Squibb Co., jeweler Tiffany & Co. and Blackhawk Network Holdings Inc.

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