Elliott owns Starbucks shares and is in talks with management: WSJ

Elliott Management has acquired a major stake in coffee chain Starbucks and works with management to seek out ways to enhance the corporate's stock price. The Wall Street Journal reported on Fridayciting people aware of the matter.

Representatives for Elliott declined to comment. The company didn’t own any shares in Starbucks as of March 31, essentially the most recent disclosure date.

A Starbucks spokesman said the corporate doesn’t comment on rumors and speculation. Starbucks shares rose greater than 6 percent on Friday.

Elliott is one of the prolific activist investors and one in all the most important hedge funds on this planet. The firm has acquired quite a lot of sizeable positions in recent months, including stakes in Southwest, SoftBank, Johnson Controls And Texas Instruments.

The Journal was unable to determine the extent of Elliott's position or his specific demands, but noted that an agreement was possible.

Starbucks struggled with an activist effort from its own unions earlier this yr. That effort, which was based on an organizing effort that began in 2021, ended with the withdrawal of the Strategic Organizing Center's candidates. Talks between management and labor are ongoing.

Starbucks has faced challenges for several quarters and has passed through quite a lot of leadership changes lately. In April, the corporate reported disappointing quarterly results, with sales at its U.S. stores down 3% and customer traffic down 7%. The coffee chain also lowered its forecast for 2024.

Starbucks reported a mid-double-digit rate of incomplete orders via its mobile app and said casual customers were stopping by less often.

CEO Laxman Narasimhan, who’s currently under increased pressure, spoke of the necessity to make improvements within the stores.

Narasimhan was personally chosen by returning Starbucks CEO Howard Schultz to steer the corporate after his previous successor, Kevin Johnson, resigned. Schultz recently commented on Starbucks' challenges but said he doesn’t plan to return for a fourth term as CEO.