Activist Jana Takes Stake in Cooper, a Maker of Medical Devices
Bausch + Lomb is considered a potential partner for contact-lens unit, and CEO says he would be interested
Activist investor Jana Partners has built a stake in Cooper COO 0.57%increase; green up pointing triangle Cos. and plans to push for strategic alternatives, including a potential deal to combine its contact-lens unit with rival Bausch + Lomb BLCO 0.53%increase; green up pointing triangle, according to people familiar with the matter.
That idea already has the rival’s support, with Bausch + Lomb Chief Executive Brent Saunders, a regular dealmaker, saying in an interview that he would be interested in such a combination.
The details
Jana also plans to push Cooper to make other changes that could help lift shares, including through improving capital allocation and returns, the people said. The exact size of its stake couldn’t be learned.
The global medical-device manufacturer makes contact lenses and vision-care products through its CooperVision segment and provides products and services for women’s health and fertility through CooperSurgical. CooperVision is one of the largest producers of soft contact lenses.
The activist believes the company’s two business units are unrelated and lack synergies, the people said. It also believes the company’s strategy has generated little value for shareholders, leaving a more complicated business with poor capital allocation, the people added.
California-based Cooper has a market value of $14 billion, after its share price has dropped more than 20% so far this year.
The company has maintained it remains confident in its strategy and being in two different, growing markets.
Jana sees potential buyers for both the contact-lens and women’s health businesses.
Among potential combinations, Jana thinks that a tie-up between Cooper’s and Bausch + Lomb’s contact-lens businesses would be attractive to investors, the people said.
Bausch + Lomb, which has a roughly $5.3 billion market capitalization, had itself been spun out of a bigger health company under Saunders.
“A potential combination with Cooper would strengthen competition and create a more scaled company in the contact-lens segment,” Saunders told The Wall Street Journal on Sunday.
Bausch + Lomb and Cooper both compete with Johnson & Johnson and Switzerland-based Alcon in the space.
The context
Cooper has recently underperformed its peers in its core contact-lens segment and reported declining margins in women’s health. In its women’s health segment, a decision to pursue billions of dollars of acquisitions in recent years has yet to bear fruit and instead weighed on the segment’s operating margins.
Cooper reported total sales of $3.9 billion in 2024, with its CooperVision business accounting for over two-thirds of that.
Jana previously pushed for a strategic review at the telecom company Frontier Communications, which ended up getting bought by Verizon Communications, as well as the specialty insurance company Markel, which is undergoing a review.
Earlier this year Jana struck an agreement with french-fry maker Lamb Weston, which added six board members after the activist pushed for changes.