Adage Capital Posts Big Gain on Heinz-Kraft Merger News

Mar 25 2015 | 11:30am ET

Adage Capital Management, the largest hedge fund shareholder of Kraft Foods Group, gained more than $50 million on paper Wednesday after the merger of Kraft and H.J. Heinz.

This morning, Brazilian private equity firm 3G Capital and Berkshire Hathaway announced a near $10 billion investment to help H.J. Heinz merge with Kraft Foods. The deal will create the third-largest food and beverage company in North America. 

Adage Capital held a little more than 2.5 million shares of Kraft at the end of Q4 2014, according to Bloomberg data. Assuming the firm didn't trade additional shares out of its fund before the deal, Adage posted a massive gain.

Shares of Kraft jumped more than 37% on the news and hit an all-time high.

Adage Capital, which is based in Boston, was founded by former Harvard Endowment equity analysts Phill Gross and Robert Atchinson in 2001. The firm manages roughly $54 billion in endowment and institutional capital. 

Last month, the company reported in a 13F filing that it had boosted its stake in Allergan, and slashed its holdings in Black & Decker and Shire plc. It reported positions in more 700 companies in the 13F filing, with 109 new entrants.


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