Hedge Funds

Jana Partners takes stake in McDonald's: Filing


Activist fund Jana Partners has taken a stake in fast food chain McDonald's, according to an SEC filing on Friday. The fund has taken a sole share stake of 842,268 McDonald's shares.

This represents a stake worth roughly $81.3 million.

McDonald's issued the following statement after the news, "We welcome all investments in McDonald's. As always, our focus is on maximizing shareholder value through initiatives that ultimately benefit our customers."

Following the report, McDonald's shares closed 0.8 percent higher on Friday.

The fund, which Barry Rosenstein founded in 2001, manages about $11 billion and invests in undervalued companies that are undergoing or expected to undergo change. It recently called on pet retailer PetSmart to sell itself—a move the company is now exploring.

Jana declined CNBC's request for comment on the deal.

"Jana—I can imagine what they're looking at is a company that has a fantastic brand, stellar balance sheet, strong and consistent profitability and cash flow," said Tony Scherrer, Smead Capital Management's director of research, in a phone interview.

Smead Capital is a long-term shareholder of McDonald's and owns a roughly 158,000 share stake in the restaurnat company.

"The activists are showing up kind of late to the party," Scherrer said. "The problems that we think the Street believes are going on they are already addressing."

McDonald's has seen weak sales across all of its units so far this year. Executives have said they are disappointed with the fast-food giant's performance.

Domestically, it is focusing its turnaround efforts on more locally relevant ingredients, a campaign to convince customers of the high quality of its food and increased customization. It has acknowledged that its needs to change with shifting consumers' expectations, which increasingly reward fast-casual players that offer fast-food-like speeds with premium customizable meals.