Sony should spin off its semiconductor business and sell its stakes in Spotify and other units to focus on becoming a “leading global entertainment company,” activist investor Dan Loeb’s Third Point Management asserted in a note and presentation to investors late last week.
In disclosing a $1.5-billion investment in Sony, Third Point argued that Sony’s business complexity is depressing its stock price. Cash from divestitures should be used to invest in its gaming, music and film businesses.
Sony’s semiconductor business made $1.3 billion in operating profit in its last fiscal year.
Along with Spotify, Third Point recommends that Sony divest stakes in M3 Inc., Sony Financial and Olympus Corp. Together, these account for 20% of the company’s market capitalization, reported Bloomberg.
A Sony spokesperson told Bloomberg that management takes constructive proposals “seriously,” but declined to comment on Loeb’s proposals.