Founded in 2001, JANA Partners is a hedge fund that manages approximately $2 billion in assets. The firm is based in New York City and is run by founder, managing partner, and co-portfolio manager Barry Rosenstein. JANA Partners focuses on investing in companies that are undergoing change or are in need of operational improvement. The firm is known for being an activist investor, meaning that it takes an active role in the management of the companies in which it invests.
Prior to founding JANA Partners, Mr. Rosenstein worked as an investment banker at multiple financial institutions. He received his MBA, with honors, from the University of Pennsylvania’s Wharton School of Business in 1984 and joined Merill Lynch’s mergers and acquisitions divisions in the same year. During the mid-80s, Mr. Rosenstein worked for well-known ‘corporate raider’ Asher B. Edelman’s Plaza Securities Corporation. Before founding JANA Partners with $35 million in capital, his last role was as a principal at Sagaponack Partners, a private equity firm.
JANA Partners’ investment philosophy has seen a radical shift over the years. What started as a value-oriented, event-driven fund has shifted its gears in the past few years and has turned into a full-blown activist hedge fund that also runs special purpose acquisition companies (SPACs). During the last decade, JANA closed down two of its stock-picking funds - Jana Partners and Jana Nirvana funds – and has concentrated on running its flagship Jana Strategic Investment (JSI) fund. Unlike most successful hedge funds, whose returns mostly come from stock-picking, market timing or quant strategies, JANA’s returns over the past few years can primarily be attributed to the work it did in restructuring its target companies.
The Jana Strategic Investment (JSI) fund has posted spectacular returns in recent years. While it made its investors richer by 30% after fees last year, it was up 52% in 2019 and has returned an average of 30% annually after fees over the previous three years. Not only that, but since its inception, Jana Strategic Investment (JSI) has posted a spectacular average annual return of 18%, comfortably beating the performance of the S&P500 during that time.
In 2007, Jana Partners returned just 7.9%, followed by a 23.4% loss for 2008. The fund was able to bring in returns of 23.9% in 2009, but it still wasn't enough to recoup its 2008 losses. Jana Partners turned things around in 2010, recovering its 2008 losses and returning 8.4%. The strong performance continued. By October 2011, Jana Partners had returned a whopping 200% since its inception.