SNE - Sony Wisely Rejects Third Point's Plan for Its Semiconductor Business
Back in June, activist investor Dan Loeb's Third Point fund management company disclosed that it had accumulated a $1.5 billion stake in Sony (NYSE: SNE). Loeb pushed for a spin-off of Sony's semiconductor business and the divestment of non-core assets -- including its financial arm and its stakes in Olympus (OTC: OCPNY) and Spotify -- to fund the expansion of its film and gaming units.
Third Point's stake only accounts for about 2% of Sony's enterprise value, but Sony still reviewed its non-core assets and decided to sell its stake in Olympus last month. However, Sony subsequently shot down Third Point's other proposals.
Sony stated that it would "proactively evaluate" its business portfolio, but that it would retain its financial unit and semiconductor business, the latter of which CEO Kenichiro Yoshida called a "vital element" of Sony's future in a recent Financial Times interview. I previously stated that Sony should keep its semiconductor business, so I think it made the right call by rejecting Third Point's proposal.