Shares in Sony dropped almost 5% today after the electronics giant rejected a proposal from activist investor Dan Loeb to partially spin off its entertainment business.
“The Sony board of directors has unanimously concluded that continuing to own 100% of our entertainment business is the best path forward,” Kazuo Hirai, the firm’s chief executive, wrote to Loeb.
The billionaire’s Third Point hedge fund has waged a three-month campaign to convince Sony to sell as much as one-fifth of its money-making entertainment arm — which is involved in movies, TV and music — to free up cash to revive the electronics business.
The move inspired ire from actor George Clooney, who called Loeb a “hedge fund guy who describes himself as an activist but who knows nothing about our business”. Loeb had compared Sony Pictures’ 2013 summer box office flops After Earth and White House Down to 1995 disappointment Waterworld.
Loeb, who owns about 7% of the Japanese company, said he was “disappointed” by Sony’s decision as shares lost ¥98 to ¥2039.
