(Bloomberg) -- Lamb Weston Holdings Inc. needs “significant” changes in leadership, and absent that, the company should consider options including a sale, according to activist investor Jana Partners.
Jana, which owns more than 5% of the french-fry supplier, said on Monday that it has yet to receive a response from the board after months of “involvement and engagement.”
“A failure of board oversight has permitted chronic mis-execution, a bloated expense structure, poor capital allocation and questionable use and disclosure practices involving the company’s aviation assets,” Jana said in a letter released to the market. The investor first disclosed its stake in Lamb Weston, which sells french fries to fast-food chains including McDonald’s Corp., in October.
Lamb Weston shares rose 2.8% at 10:47 a.m. in New York trading. The stock has dropped about 25% this year amid two straight quarters of sales declines.
A deal may already be in the works. Last week, Reuters reported that cereal maker Post Holdings Inc. is working with bankers to explore a possible transaction with Lamb Weston.
Lamb Weston and Jana Partners declined to comment. Post Holdings didn’t immediately respond to a request for comment.
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