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Whole Foods in play as activist investor with an over 8% stake wants it to explore a possible sale

New York-based investment firm Jana Partners LLC has built up an 8.3% stake in Whole Foods, according to a regulatory filing yesterday, up from the 7.15% holding it had at the end of last month.

Whole Foods store
A spokeswoman for Whole Foods said the company “is open to the views and opinions of all of our shareholders”

Whole Foods Market Inc (NASDAQ:WFM) looks to be in play after an activist investor which has amassed a large stake in the trendy grocer said it wants it to accelerate its turnaround and explore a possible sale.

New York-based investment firm Jana Partners LLC has built up an 8.3% stake in Whole Foods, according to a regulatory filing yesterday, up from the 7.15% holding it had at the end of last month.

Along with several allies, wants the grocery chain to improve its technology and operations to better compete with larger rivals, shake up its board and explore how much potential bidders might be willing to pay.

Jana said in its filing that it had started a review of strategic options for Whole Foods in light of the company's "apparent unwillingness to engage in discussions with third parties regarding such alternatives."

Open to opinions …

In response, a spokeswoman for Whole Foods said the company “is open to the views and opinions of all of our shareholders.”

She added: “We are committed to driving value for all Whole Foods Market shareholders and will continue to act to achieve this important objective.”

Jana has lined up possible board nominees, according to its filing, four months before the deadline to launch a fight to control the board.

Whole Foods has been losing shoppers to rivals as the natural and organic category that it pioneered has gone mainstream via grocery rivals ranging from Kroger Co (NYSE:KR) and Wal-Mart Stores Inc (NYSE:WMT) to newer online competitors such as Amazon.com Inc (NASDAQ:AMZN).

In premarket trading in New York, Whole Foods shares were 0.2% higher at US$34.25.

Quick facts: Whole Foods Market Inc

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NASDAQ:WFMI
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