(Bloomberg) -- Jana Partners has increased its stake in Rapid7 Inc. as it continues to push the cybersecurity software provider to pursue a sale.
The activist investor revealed a 13% economic voting interest in Boston-based Rapid7’s outstanding shares in a filing on Friday. Jana’s filing was made jointly with private investors Chad Kinzelberg, Michael Joseph Burns and Robert Bradshaw Henske.
Shares in Rapid7 have fallen almost 19% in New York trading over the last 12 months, giving company a market value of about $2.3 billion. Jana revealed a 4.3% position in Rapid7 earlier this year.
In June, the activist’s managing partner Scott Ostfeld said Rapid7 should consider selling itself to maximize value for shareholders. Ostfeld said the company had underperformed indexes and peers and its management had been trying to do too much at once.
Jana intends to work toward constructive discussion with Rapid7’s management team to address its concerns around pay, governance and board composition, as well as to evaluate the company’s value in any sale, according to Friday’s filing.
Should things develop into a proxy battle, then Jana could nominate Kinzelberg, Burns and Henske for seats on Rapid7’s board, according to a person familiar with the matter, who asked not to be identified discussing confidential information.
A spokesperson for Jana declined to comment beyond the filing. A representative for Rapid7 didn’t immediately provide a comment.
New York-based Jana has had successes in recent campaigns at telecommunications group Frontier Communications Parent Inc., industrial technology company Trimble Inc. and pet food provider Freshpet Inc. It had called for a potential sale at Frontier, which this month agreed to be taken over by Verizon Communications Inc.
Kinzelberg was senior vice president of corporate and business development at Palo Alto Networks Inc. Burns is a former chief financial officer of companies including Imperva Inc. and Gigamon Inc. Henske was the CFO of Intuit Inc. and Synopsys Inc.
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