Shares of Wild Oats Markets Inc. jumped 7% on Monday after Yucaipa Cos. said it raised its stake in the organic and natural foods grocer.
Yucaipa, the Los Angeles-based private equity firm owned by billionaire grocery magnate Ron Burkle, increased its stake in Boulder, Colo.-based Wild Oats to 14.9% from 9.2%, according to a 13D filing with the Securities and Exchange Commission on Friday.
"According to management, Yucaipa indicated that this would remain a passive investment; however, the investment size and new 13D language potentially suggests otherwise," Bear Stearns analyst Robert Summers said in a note Monday.
In the filing, Yucaipa said it might engage in talks with other persons or entities "regarding potential strategic transactions" involving Wild Oats and other companies. That wording differed from the SEC filing when Yucaipa disclosed its 9.2% stake in Wild Oats last March. At that time Yucaipa said only that it might "communicate with other shareholders, industry participants and other interested parties concerning the company."
The language in the latest filing "suggests a more hands-on approach and greater involvement," Summers said. "This represents a dramatic change and could foreshadow more aggressive efforts by Yucaipa to increase visibility on the earning power of the underlying business."
Yucaipa and its affiliates acquired more than 1.7 million shares of Wild Oats from Dec. 16 through Friday.
Wild Oats shares rose $1.04 to $15.11.