The hedge fund that has called on Sony Corp to list part of its profitable entertainment arm has boosted its stake in the company, a report said yesterday, days ahead of a shareholders’ meeting.
Billionaire investor Daniel Loeb, who last month proposed hiving off up to 20 percent of the division, which includes music and movies, said his Third Point LLC fund had since added another five million shares, taking its stake to 7 percent.
In a new letter to Sony chief executive Kazuo Hirai, carried by the Wall Street Journal yesterday, Loeb says the division lacks the “discipline and accountability” of its competitors, and would benefit from a listing.
“It seems difficult to argue that Entertainment would not be strengthened by the transparency that comes with public reporting, an active media analyst community evaluating financial performance regularly and an expert board with strongly aligned incentives,” the letter said.
Sony, like many Japanese companies that came of age in the booming Japan of the 1970s and 1980s, diversified its operations to include seemingly unrelated businesses with few synergies.
Critics say this has left them too big to cope with their more nimble overseas competitors and has led to years of profit-bleeding. Despite having taken a particularly bad beating in the sector, the firm has repeatedly reiterated its commitment to producing televisions and other home electronics.
In his more recent letter, Loeb — an outspoken investor with a reputation for pushing change at the companies he targets — suggested Hirai serve as head of the board of the new business, while retaining his spot at the helm of the overall group.
He also repeated his offer of service on Sony’s board, noting the size of his fund’s stake in the company.
Last month, Hirai said the board would examine Loeb’s proposal. The company is to hold its annual shareholders’ meeting in Tokyo tomorrow.
“As previously stated, Sony’s board of directors will conduct an appropriate review of Third Point’s proposal. We aren’t commenting on specifics of their proposal,” the company said in a statement yesterday.
In the fiscal year to March, Sony reported its first annual net profit in five years, although it was largely driven by a weakening of the yen — which boosts the value of its repatriated foreign income — and a string of asset sales, including unloading its Manhattan headquarters.
Hirai has said he is on track to bringing Sony’s money-losing TV business into profitability.
WASHINGTON’S INCENTIVES: The CHIPS Act set aside US$39 billion in direct grants to persuade the world’s top semiconductor companies to make chips on US soil The US plans to award more than US$6 billion to Samsung Electronics Co, helping the chipmaker expand beyond a project in Texas it has already announced, people familiar with the matter said. The money from the 2022 CHIPS and Science Act would be one of several major awards that the US Department of Commerce is expected to announce in the coming weeks, including a grant of more than US$5 billion to Samsung’s rival, Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), people familiar with the plans said. The people spoke on condition of anonymity in advance of the official announcements. The federal funding for
HIGH DEMAND: The firm has strong capabilities of providing key components including liquid cooling technology needed for AI servers, chairman Young Liu said Hon Hai Precision Industry Co (鴻海精密) yesterday revised its revenue outlook for this year to “significant” growth from a “neutral” view forecast five months ago, due to strong demand for artificial intelligence (AI) servers from cloud service providers. Hon Hai, a major assembler of iPhones that is also known as Foxconn, expects AI server revenues to soar more than 40 percent annually this year, chairman Young Liu (劉揚偉) told investors. The robust growth would uplift revenue contribution from AI servers to 40 percent of the company’s overall server revenue this year, from 30 percent last year, Liu said. In the three-year period
LONG HAUL: Largan Energy Materials’ TNO-based lithium-ion batteries are expected to charge in five minutes and last about 20 years, far surpassing conventional technology Largan Precision Co (大立光) has formed a joint venture with the Industrial Technology Research Institute (ITRI, 工研院) to produce fast-charging, long-life lithium-ion batteries for electric vehicles, mobile electronics and electric storage units, the camera lens supplier for Apple Inc’s iPhones said yesterday. Largan Energy Materials Co (萬溢能源材料), established in January, is developing high-energy, fast-charging, long-life lithium-ion batteries using titanium niobium oxide (TNO) anodes, it said. TNO-based batteries can be fully charged in five minutes and have a lifespan of 20 years, a major advantage over the two to four hours of charging time needed for conventional graphite-anode-based batteries, Largan said in a
Taiwan is one of the first countries to benefit from the artificial intelligence (AI) boom, but because that is largely down to a single company it also represents a risk, former Google Taiwan managing director Chien Lee-feng (簡立峰) said at an AI forum in Taipei yesterday. Speaking at the forum on how generative AI can generate possibilities for all walks of life, Chien said Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) — currently among the world’s 10 most-valuable companies due to continued optimism about AI — ensures Taiwan is one of the economies to benefit most from AI. “This is because AI is