October 27, 2016 / 3:41 PM / 3 years ago

CORRECTED-UPDATE 1-Activist Jana Partners stocks up on HD Supply shares

(Corrects paragraph 2 to show separation occurred in 2007 not 2006)

By Michael Flaherty

Oct 27 (Reuters) - Activist investor Jana Partners LLC disclosed an 8.1 percent stake in HD Supply Holdings Inc , and said it had held discussions with the company’s management about possible strategic options.

HD Supply, the industrial product distributor that separated from parent Home Depot Inc in 2007, saw its stock rise 3 percent to $33.11 on Thursday.

Jana, which now owns $449 million worth of HD Supply’s shares, is a hedge fund that owns a broad range of positions but is best known as one of the largest activist investors.

The stake makes the hedge fund the second-biggest shareholder in HD Supply, according to Thomson Reuters data.

“HD Supply welcomes open communications with our shareholders and we value constructive input,” the company said in a statement, adding that it will continue to take action to increase shareholder value.

Jana’s regulatory filing did not offer specific plans that it wants the company to follow to increase its share price, which has risen 14 percent in the last year.

Jana said in the filing that it believes HD Supply’s shares are undervalued and that it has discussed strategic options with the company’s management team. Jana added that it may have further discussions related to the composition of HD Supply’s board of directors.

Additional reporting by Ankit Ajmera in Bengaluru; Editing by Sriraj Kalluvila and Phil Berlowitz

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