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 stated on Friday, as some buyers are pushing for strategic adjustments on the shopper 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 worth 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 buyers for months and averted a full-blown proxy battle 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 assessment the way it positions its manufacturers and the way they’re priced in an effort to enhance 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 desires the corporate to think about strategic options together with a potential sale of your entire firm or parts of it, sources aware of the agency’s engagement stated.
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 Instances first reported Third Level’s stake in Kenvue on Friday.
Kenvue stated it often engages with its buyers however doesn’t touch upon particular person investor discussions. The board acts “in the perfect pursuits of the corporate and all Kenvue shareholders and we stay centered on accelerating sustainable, worthwhile development and enhancing shareholder worth,” the corporate stated in an announcement.
Whereas Kenvue’s manufacturers, together with Aveeno, Listerine and Zyrtec, are well-known, web gross sales had been flat at $15.5 billion in 2024. The corporate’s inventory worth, whereas up 8% this yr, 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, occasionally, activism wherein it engages with administration to push corporations together with Advance Auto Components, Walt Disney and Tub & Physique Works to carry out higher.
It oversees roughly $12 billion in belongings and returned 25% in 2024, a dramatic improve from a achieve of roughly 4% in 2023 and a 22% loss in 2022. Final yr, the agency rotated into shopper discretionary, monetary and industrial corporations 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)