PetSmart Said to Explore Sale Amid Pressure by Activist Investors

Tuesday, 19 Aug 2014 03:50 PM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink
PetSmart Inc. plans to explore a potential sale of the company, people familiar with the matter said on Tuesday, after several shareholders led by activist investor Jana Partners LLC pressured the pet supply retailer to sell itself.

PetSmart, which has a market capitalization of nearly $7 billion, could announce the intention to explore strategic alternatives as soon as this week, although the timing could yet change, one person said.

There is no guarantee the review will lead to a deal and PetSmart could still determine that it would be better off on its own, the people cautioned, asking not to be named because the matter is not public.

Representatives for PetSmart could not be immediately reached for comment.

Shares of PetSmart rose 3.4 percent to $70.80 in late afternoon trading on the news.

PetSmart's likely move marks yet another victory for Jana. The firm, which is run by Barry Rosenstein, has amassed stakes in companies it perceived to be undervalued and successfully pushed them to sell themselves in recent months.

Earlier this year, Jana pressured engineering and construction services firm URS Corp. to pursue a sale, resulting in its takeover by industry rival AECOM Technology Corp. for $4 billion.

Last year, Jana pushed Safeway Inc. to review strategic alternatives after disclosing a stake in the grocery chain in September. Safeway agreed in March to be acquired by private equity firm Cerberus Capital Management LP in a deal valued at about $9.4 billion.

PetSmart has faced mounting investor pressure at a time when fierce competition from large retailers including Wal-Mart Stores Inc. and Amazon.com Inc. is squeezing specialty stores.

Jana Partners, which has reported a 9.8 percent stake in PetSmart, has been calling on the company to pursue a sale after what it calls years of financial underperformance. It has been joined in its push by other investors, including Longview Asset Management.

Phoenix-based PetSmart, founded in 1986, has about 53,000 employees and operates more than 1,340 pet stores, according to its website.

© 2014 Thomson/Reuters. All rights reserved.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
You May Also Like

Here's Why Most Unemployed Americans Don't Get Benefits

Saturday, 22 Nov 2014 10:35 AM

Even though the U.S. job market is gaining strength, there are still a lot of unemployed Americans. Yet only a fraction  . . .

Kudlow: Obama's Big Mistake Is Ignoring High-Skilled Visa Problem

Friday, 21 Nov 2014 22:08 PM

Obama’s executive actions not only usurp powers that are not his, they don’t really solve key immigration problems. . . .

Furchtgott-Roth: Obama's Immigration Edict Is Windfall for Wal-Mart

Friday, 21 Nov 2014 17:47 PM

President Barack Obama's immigration edict is likely to enrich Wal-Mart because the previously undocumented millions wou . . .

Most Commented
Top Stories

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved