Activist Starboard has big stake in Kenvue after J&J spinout

Kenvue CEO Thibaut Mongon at the New York Stock Exchange for its initial public offering, May 4, 2023.

Source: NYSE

Activist investor Starboard Value has a large stake in Kenvue, which spun out of Johnson & Johnson in mid-2023, according to people familiar with the matter.

The activist is looking for the company to improve its share price, said the people, who requested anonymity to discuss private information freely. CNBC could not learn size of the stake nor Starboard’s specific plans. Starboard’s Jeff Smith is expected to discuss the activist’s plans for the company in detail at 13D Monitor’s Active-Passive Investor Summit on Tuesday.

Shares surged roughly 8% in pre-market trading Monday on the news, which was first reported by The Wall Street Journal.

Kenvue is the maker of iconic brands familiar to both investors and the broader public, such as Aveeno, Band-Aid, Listerine, Neutrogena, Tylenol and J&J’s namesake baby powder and shampoo.

Starboard’s push at Kenvue comes just two weeks after news broke it had amassed a roughly $1 billion stake in struggling pharmaceutical company Pfizer.

Johnson & Johnson completed its separation from Kenvue in August last year, though the pharmaceutical giant still holds a stake in the new company. It marked the biggest shake-up in J&J’s nearly 140-year history.

J&J announced the split in late 2021 as a bid to streamline operations and refocus on its pharmaceutical and medical device divisions.

Shares of Kenvue are largely unchanged so far this year, while the S&P has risen about 23%. Other consumer products giants are outperforming Kenvue this year. Haleon is up more than 20% for the year, while Procter & Gamble’s stock is up nearly 17%.

Kenvue started trading on the New York Stock Exchange in May 2023, ending its first day of trading with a share price of about $27. Shares of the company have fallen since then, closing at $21.72 on Friday. That puts Kenvue’s market value at around $41.6 billion, down from $50 billion on the day of its public market debut.

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