Jana Books Big Profit On Bookstore Bet

May 1 2012 | 12:31pm ET

Jana Partners' Barry Rosenstein is taking a bit of a bow after his investment in Barnes & Noble paid off in a big way this week.

The activist hedge fund manager made a paper gain of $49.2 million on its 12% stake in the bookseller, after Microsoft announced yesterday that it would invest $300 million in a new unit that will cover B&N's Nook digital reader and college businesses, two of its most profitable business lines.

"The question is, why would anyone short that stock?" Rosenstein asked on CNBC. "We figured we have very little downside. We thought there was a very high probability that some sort of strategic transaction like this would occur."

The Microsoft deal will create a still-unnamed business that will report separately from B&N and that is, at a stroke, worth more than B&N itself with a $1.7 billion valuation. Microsoft will own about 18% of the business, and B&N the rest.


In Depth

Q&A: Decathlon Capital On Revenue-Based Alternative Lending

Oct 30 2017 | 3:49pm ET

The explosion in private credit activity since the end of the financial crisis is...

Lifestyle

CFA Institute To Add Computer Science To Exam Curriculum

May 24 2017 | 9:25pm ET

Starting in 2019, financial industry executives sitting for the coveted Chartered...

Guest Contributor

CAIS: How Technology is Disrupting the Alternative Investment Industry

Nov 7 2017 | 5:35pm ET

If there’s one thing that alternative investment professionals can agree on, it...