Jana Partners, whose 7.2 percent stake makes it the second-largest shareholder in the Slim Jim Beef Jerky maker, said the company’s shares were undervalued.
Since the $5 billion acquisition of RalCorp, ConAgra has missed its forecasts repeatedly, cut long-term targets, not increased dividend and faced operating performance challenges, Jana said in a regulatory filing on Thursday.
The hedge fund said it was prepared, if necessary, to nominate three directors who had the expertise to help ConAgra review its strategy, address operational performance and costs, optimize capital structure and review “various potential alternative transactions and structures”.
The company, which has been struggling to boost sales at its private-label business, extended the deadline for shareholders to nominate board directors to July 8 from June 21 and said it was open to talks after it reported results on June 30.
Jana’s three nominees include its founder Barry Rosenstein, former Nestle USA Chief Executive Brad Alford as well as Diane Dietz, who used to oversee supermarket chain Safeway’s private-label business.
ConAgra became the largest U.S. private-label food company when it bought Ralcorp, but since then the business has fallen short of profit targets due to cut-price deals Ralcorp entered into with retailers before the takeover.
ConAgra said in December it did not expect profit to recover in its private-brand business – which makes cereals, pasta, snacks and sauces that retailers sell under their own brand – until the year ending May 2016.