Jana Partners Has Nearly 10% Stake in Freshpet, Sources Say

The activist hedge fund has recruited former Kraft Foods Chief Financial Officer

Timothy McLevish,

as well as

Diane Dietz,

who was chief executive of skincare-product maker Rodan & Fields, and ex-Jarden Corp. Chief Executive

James Lillie

for help with the campaign, the people said.

Two former professional athletes—basketball star

Dwayne Wade

and baseball star

CC Sabathia

—are serving as special advisers, they said.

Freshpet specializes in refrigerated high-end pet food made with blends of meat, vegetables and fruits. Secaucus, N.J.-based Freshpet has struggled lately; when announcing its second-quarter earnings in August, the company revised its guidance as a result of inflation pressure and quality-control issues. Its shares were down roughly 80% from their high in April 2021 and about 60% so far this year through Wednesday.

At its peak, Freshpet had a market value of around $8 billion; it is now just under $2 billion.

Earlier this month, the company shuffled several executive roles in a bid to improve its operations and said its CFO resigned. CEO

Billy Cyr

said at the time that the company’s rapid growth over the past few years had created “a unique set of opportunities and challenges.”

In recent years, food makers including Nestlé SA and General Mills Inc. have pointed to pet-food sales as a bright spot as consumers spend more on fancier offerings. Nestlé owns the Purina brand, among others, while General Mills’ portfolio includes Blue Buffalo, a premium brand it bought for around $8 billion in 2018.

There have been a string of investments in the sector more recently, including Mars Inc.’s acquisition of a small fresh-pet-food maker earlier this year. In August,

Colgate-Palmolive Co.

said it was buying three dry-pet-food manufacturing plants for $700 million to support the growth of its Hill’s Pet Nutrition business.

New York-based Jana was founded in 2001 by

Barry Rosenstein.

It has agitated at other consumer companies including Whole Foods Market Inc., sold to

Amazon.com Inc.

in 2017, and Pinnacle Foods, sold to

Conagra Brands Inc.

in 2018. In 2014, it pushed for PetSmart to be sold. The pet-supply retailer was sold the following year to a consortium of private-equity firms.