Latham Leads for Safeway as Hedge Fund Snags Stake
Beyond Safeway, Jana announced earlier this year that it had invested in e-commerce company Groupon and social media game maker Zynga. The hedge fund also lost a proxy contest in April with Canadian agricultural products provider Agrium. Davies Ward Phillips & Vineberg partners I. Berl Nadler and J. Alexander Moore advised Jana during that battle, while Blakes, Cassels & Graydon and Paul, Weiss, Rifkind, Wharton & Garrison represented Calgary-based Agrium. (Norton Rose Fulbright took the lead for Agrium's board.)
Last year Jana took a 12 percent stake in struggling bookstore chain Barnes & Noble, whose shares surged 18 percent upon news of the investment. Safeway’s shares rose nearly 10 percent Tuesday and closed up another 1 percent Wednesday as the company unveiled details of its poison pill in a series of SEC filings.
Another SEC filing by Safeway showing Jana’s investment in the company bears the name of Schulte Roth & Zabel business transactions chair Marc Weingarten and corporate partner Eleazer Klein. While Schulte has previously advised Jana, the New York–based hedge fund has so far handled its Safeway investment in-house.
As it happens, Jana’s in-house ranks are staffed with Schulte alums. Gary Claar, a cofounder of the hedge fund who transitioned to a senior advisory role last year, began his career at the firm. Two former Schulte associates, Charles Penner and Jennifer Fanjiang, serve as Jana’s chief legal officer and general counsel, respectively.
Should Jana’s investment in Safeway become more contentious, it’s likely Schulte will be brought in as outside counsel. The firm’s hedge fund connections are well-known, and Weingarten has advised Jana on its push to break up The McGraw-Hill Companies, which sold its education unit in a $2.5 billion deal last year. Weingarten has also counseled Jana in past proxy fights at media conglomerate Time Warner and former energy company Kerr-McGee.
Jana also turned to Schulte to represent it in bankruptcy court against claims brought by former clients of Marc Dreier, who accused the disgraced New York litigator of cutting a sweetheart settlement with the hedge fund in another case in order to scare up some much-needed cash.
Schulte made news of its own this week, announcing its hire of New York University School of Law professor Samuel Estreicher as of counsel in its labor and employment group. Estreicher is the director of the school’s Center for Labor and Employment and codirector of its Opperman Institute of Judicial Administration, two positions that he will retain in addition to his new role at Schulte.