SONY yesterday rejected a proposal from activist shareholder Dan Loeb to partially spin off its entertainment business, but the billionaire investor vowed to keep talking with the company and to explore other options.
The Japanese company said it could still squeeze synergies from its decades-old marriage of content and hardware and promised more disclosure in its entertainment operations.
Loeb’s Third Point hedge fund has waged a three-month campaign to convince the company to sell as much as one-fifth of its money-making entertainment arm to free up cash to revive the electronics business.
“Sony’s board of directors has unanimously concluded that continuing to own 100 per cent of our entertainment business is the best path forward and is integral to Sony’s strategy,” Sony boss Kazuo Hirai said in a letter to Loeb.
A source familiar with the discussions said Sony’s decision reflected worries about listing a subsidiary, not resistance to corporate reform in Japan.
Loeb, who owns around seven per cent of Sony through shares and cash-settled swaps, said he was disappointed with the decision. “Third Point looks forward to an ongoing dialogue with management and intends to explore further options to create value for Sony shareholders,” Third Point said.
Sony shares fell 4.6 per cent to ¥2,039.