Barnes & Noble (NYSE: BKS) woke up the other day and there was a stranger eating its cereal, calmly reading the paper.

While the characterization isn't quite fair, for many stockholders Jana Partners is a completely unknown quantity. With the fund now owning a major stake in Barnes & Noble, everyone needs to get used to the sight of Jana making changes. While some folks will shake their befuddled heads, the Street has already taken notice. It knows Jana very well, indeed.

The Yoko Ono of investors
Jana is a New York-based hedge fund, co-founded in 2001 by Barry Rosenstein and Gary Claar. As a typical activist fund, it purchases laggard stocks and then advocates loudly for changes to perk the stocks up. When the shares rise, the fund can sell for profit.

Recently Jana helped drive McGraw-Hill (NYSE: MHP) to announce a split into markets and education firms, which will take place later this year. In the fund's original plan, the publisher would have split itself into four. While the board rejected that plan, it did take the basic advice of "more equals better."

Day in the life
It's not all yelling and appointing board members, though. Jana operates as a successful investment firm in the traditional sense as well. By October 2011, the fund had returned 200% in its 10 years. Much of this has come through investing in companies like TripAdvisor and Expedia, which have performed well without the need for intervention.

On the activist side, Barnes & Noble is just the most recent on a list that includes El Paso (NYSE: EPB) and Marathon Petroleum. Jana pressured El Paso to split and looked to have succeeded until the company announced its intent to be purchased by Kinder Morgan (NYSE: KMP) last year. Regardless of the nature of the stock lift, Jana has done well. Between May, when the fund increased its stake, and today, the stock has grown 50%.

The end
While Jana doesn't always win out -- it lost 23% in 2008 -- it has done well for itself on the whole. For Barnes & Noble, there has already been talk from the company of spinning off the Nook business from the core retail operation. This could bring new investment to the Nook, and free the rest of the company from the investment burden that comes along with the new technology. Those sorts of spin-offs are just the thing Jana has been happy to facilitate in the past.

While the fund did not make its intentions clear with its most recent purchase, it has left the door open for an activist role. The acquisition gives Jana a 12% stake in the bookseller, which would allow it to take an active role in leading the company over the coming months. While current investors should be excited about the jump in stock price, they should also pay close attention to their new houseguest as this story unfolds.

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Fool contributor Andrew Marder doesn't own in any of the stocks mentioned in this article. He worked for Barnes & Noble previously. Motley Fool newsletter services have recommended buying shares of El Paso Pipeline Partners. Motley Fool newsletter services have recommended writing puts on Barnes & Noble. The Motley Fool has a disclosure policy.
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