Barry Rosenstein’s JANA Partners Exits Its Position as Civeo Corp (CVEO)’s Shareholder

Barry Rosenstein’s JANA Partners shed its entire stake in Civeo Corp (NYSE:CVEO) before the beginning of the new year, relinquishing its spot as the company’s largest institutional shareholder. The hedge fund previously owned a position containing 12.24 million shares, valued at around $142.12 million. According to the latest 13D filing, Civeo Corp no longer forms part of the investment firm’s equity portfolio.

JANA Partners was founded by Barry Rosenstein in 2001, as a value oriented and event-driven investment firm. It is renowned for its focus on the cash flow aspect of the businesses it invests in and for ignoring hot stocks. The firm’s equity portfolio, which is valued at around $19.3 billion, is quite diversified, yet the financial services industry is its main component. Jana Partners typically employs fundamental value analysis in order to seek out undervalued companies with underlying potential. In order to unlock further value, the firm has often opted to become an actively engaged shareholder. Apart from short and long investments, Barry Rosenstein’s company invests throughout the entire capital structure, ranging from equity to debt. When it came to Civeo Corp (NYSE:CVEO), the firm was almost forced to abandon its activist nature and shed its stake, due to the plummeting shareprices. Just a few months back, JANA Partners pushed to gain seats on the Board of Directors, and played a crutial role in Civeo Corp’s spin-off from Oil States International Inc (NYSE: OIS).

Barry Rosenstein - Jana Partners

Civeo Corp (NYSE:CVEO) is a provider of workforce accommodations in the Canadian oil sands and the Australian natural resource regions. The company specializes in housing solutions for long-term and temporary workers, providing catering, facility management, water systems, and logistics services. In addition to installing accomodations on oil platforms, vessels, and ships, Civeo Corp operates water treatment plants for its clients in remote locations. Despite offering essential services, the Houston, Texas- based entity has been suffering from depressed stock prices as of late, and was forced to suspend its quarterly dividend. Furthermore, the company announced a significant workforce reduction, along with budget cuts for 2015, which shareholders were not happy to hear. Considering these latest developments, along with the fact that shareprices have dropped from around $20 in May 2014 to a mere $4.11 by the end of the year, it comes as little surprise that JANA Partners decided to shed its entire stake in Civeo Corp.

Although Barry Rosenstein’s fund decided to cut its holding in Civeo Corp (NYSE:CVEO), other institutional investors remain bullish regarding the company. David Einhorn’s Greenlight Capital for example does not seem to be worried about the decline of the stock, as it proceeded to increase its exposure by around 4.5 million shares. David E. Shaw’s D.E. Shaw & Co., L.P also increased its stake in Civeo Corp during the third quarter, disclosing a position of 5.44 shares. Clearly, several hedge funds are betting on the company to bounce back, thus making it a good time to make an opportunistic investment.

Disclosure: Pablo Erbar holds no position in any stocks or funds mentioned.