NEW YORK - Cannae Holdings, Inc. (NYSE:CNNE) has entered into a strategic partnership with investment firm JANA Partners, which includes an equity exchange and a collaborative effort to identify acquisition opportunities. The deal, which was finalized with a simultaneous sign and close, granted Cannae a minority stake in JANA.
Under the terms of the partnership, Cannae exchanged 1.85 million shares of its common stock and paid $18.3 million in cash to cover related taxes for the equity stake. Additionally, Cannae has pledged to invest a minimum of $50 million into JANA funds. The transaction also involved voting arrangements in favor of Cannae's board and management, as well as customary lock-up provisions for the shares.
William P. Foley, II, Chairman and CEO of Cannae, expressed enthusiasm for the partnership, highlighting the potential for proprietary deal flow and acquisition opportunities that align with Cannae's focus on undervalued companies. JANA's principals, Barry Rosenstein and Scott Ostfeld, reciprocated the sentiment, foreseeing enhanced capabilities and returns for investors of both entities.
Cannae Holdings specializes in acquiring and managing operating companies, with a long-term ownership approach that does not adhere to fixed timelines for the sale or disposal of its businesses. JANA Partners, established in 2001, is known for its active investment strategy, engaging with management teams and boards to realize shareholder value.
The collaboration aims to leverage JANA's network and experience in engaged investing to benefit Cannae's acquisition strategy, while JANA stands to gain from Cannae's industry expertise and involvement in managing acquired businesses.
This strategic move is expected to expand the investment universe for both firms and could lead to enhanced shareholder value. The partnership excludes any fees under Cannae's management services agreement with Trasimene Capital Management, LLC.
The press release includes forward-looking statements that involve risks and uncertainties, cautioning that actual results may differ from those projected. The risks detailed in the company's regulatory filings with the Securities and Exchange Commission are recommended for review by interested parties. The information for this article is based on a press release statement.
InvestingPro Insights
In light of Cannae Holdings' recent strategic partnership with JANA Partners, it's important to understand the company's financial health and market position. According to InvestingPro data, Cannae Holdings has a market capitalization of $1.42 billion. Despite a challenging environment reflected by a negative revenue growth of -11.9% over the last twelve months as of Q3 2023, the company's management is taking an aggressive stance on share buybacks, which could signal confidence in the company's future prospects.
An InvestingPro Tip notes that Cannae Holdings does not pay a dividend, which aligns with its strategy of reinvesting in the business and potentially funding new acquisition opportunities in collaboration with JANA Partners. Moreover, the company's gross profit margin stands at 6.68%, which is considered weak and could be an area of focus for improvement in the partnership's pursuit of enhancing shareholder value.
For investors seeking more in-depth analysis, there are additional InvestingPro Tips available that shed light on analyst expectations and profitability outlooks. For instance, analysts do not anticipate Cannae Holdings to be profitable this year, which could be a crucial factor for potential investors to consider. To access these insights and more, investors can visit https://www.investing.com/pro/CNNE and use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
It's worth noting that there are 6 additional InvestingPro Tips listed for Cannae Holdings, providing a comprehensive analysis of the company's financials and market performance. These tips could offer valuable guidance to investors looking to make informed decisions in the context of the company's strategic initiatives.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.