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Retail

Activist Burkle Going After Whole Foods (WFMI)

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By Douglas A. McIntyre Updated Published
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Whole_foods_logoWhole Foods Markets Inc. (NASDAQ: WFMI) has a new activist in its ranks.  An SEC filing showed that Ron Burkle’s Yucaipa Cos. investment vehicle is now holding a 7% stake in the organic and high-end grocery store operator.  The filing shows a 9.81 million share stake was taken.  This will also make it one of the top 4 shareholders if the most recent data is accurate. 

Burkle’s filing noted that it sees substantial opportunities for thecompany to improve operations and its pricing image while maintainingits high-quality product offering.  It has apparently been acquiringshares since November 24 as it believes that company is undervalued.

Yucaipa is noting the activist stance rather than a passive investmentstance right from the start.  The filing noted that the firm intends todirectly communicate with Whole Foods’ board of directors and itsmanagement, and noted that it may communicate with other shareholdersregarding the company. It also noted that it may solicit or vote itsshares to approve an extraordinary transaction such as merger orconsolidation or look to make changes to the composition or size of theboard of directors.

Burkle will probably also want to make sure he keeps founding CEO John Mackey from posting anonymous messages on the web.  Whole Foods closed at $10.01 yesterday and its 52-week trading range $7.04 to $42.48.

Jon C. Ogg
January 8, 2009

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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