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Diving Briefs:
Dive Insights:
JANA has put pressure on Lamb Weston to change its operation for several months and even explore sales. In cooperation with Continental Grain, I bought a shares of the company last fall. The activist group questioned the company’s decision and pointed out that the supervision and execution mistakes were not good. Appoint an insider as a CEO in December.
This contract means that the sale of Lamb Weston is now out of the table, but the influence of JANA is important in a company based on Ida. The activist added additional board members, including Bradley Alford, CEO of Nestle, and Lawrence Kurzius of former McCormick.
Ultimately, Lamb Weston will add two mutually consensus with four of JANA’s proposed directors. This movement expands the board of Lamb Weston from 11 to 13 members.
Mike Smith, the CEO of Lamb Weston, said in a statement that “we are pleased to reach this contract with JANA and Continental Grain.” “After considering the constructive participation with them and the perspective of discussions with additional shareholders, we are convinced that this result is in the best interests of the company and all shareholders.”
Robert Moskow, an analyst at TD Cowen in the research note, was surprised that JANA had not started a surrogate fight to completely replace the board and bring a new management team. He said, “We show our willingness to cooperate with the legacy board we didn’t expect.”
MOSKOW pointed out that about one -third of Lamb Weston’s US contracts will appear for renegotiation at the end of this year, which can lead to pressure on the company because the demand for the product is weakened. The company lost its US customers in 2024 even after agreeing to lower the price of a new contract.
“As far as we know, LW is currently a capacity to terminate Mossball or capacity of the only company in North America. This suggests a long -time frame for creating shareholder value.”
Due to slowing fast food sales, the profits of Lamb Weston, a supplier of McDonald’s and other major restaurant chains, were under pressure.
Last October, Lamb Weston announced that it would be closed There is an older high -cost treatment facility in Cornell, Washington, and temporarily reduces the specific production line and schedule of the North American network. In addition, we plan to reduce 4% or about 428 jobs of the workforce and remove unfilled work locations.
