Friday, 29 August 2014
Last updated 2 hours ago
Aug 8 2013 | 10:36am ET
Daniel Loeb is known for his poison pen and acid tongue, but he's decided against employing either against a beloved Hollywood icon.
The Third Point founder was rebuffed this week in his bid to force Sony Corp. to partially spin-off its entertainment unit, which he had blasted as "characterized by a complete lack of accountability and poor financial controls." His criticisms earned Loeb a rebuke from actor George Clooney, whose production company works with Sony.
Clooney called Loeb a "carpetbagger" who "knows nothing about our business."
But rather than take the bait, Loeb was uncharacteristically accommodating towards both Sony and Clooney in an interview with Variety magazine.
"Not withstanding the fact that the media likes to create a stir, I admire Mr. Clooney's passion for Sony and his loyalty to Sony and his friends there," Loeb said. He even offered something of an olive branch, telling Variety that he thinks he and Clooney share a "common goal."
"A more disciplined company with better allocation of capital means less money spent on bureaucracy and more investment in motion pictures," he said. "We are all for intelligent investment in creative content. I believe our interests are aligned in a way he probably doesn't realize."
He even expressed some contrition, acknowledging that his criticism of the failure of Sony's summer blockbuster releases.
"We're not really focused on individual movies or their slate," Loeb said. "I know I mentioned that in the last letter, but at this point it is more productive to support management and the goals advanced by" Sony CEO Kazuo Hirai in his letter to Loeb, which the hedge fund manager described as "thoughtfully written and detailed in its discussion of profitability and transparency."
"It is probably unfair to focus on one or two bad movies, just in the way that Third Point from time to time can have one or two bad months or a bad year," he continued. "What is important is the overall profitability and margins over time."
Loeb was show equal equanimity about Sony's rejection of his proposal, a far cry from his usual reaction to the failure of an activist campaign. Indeed, Loeb went so far as to say that Sony's promises of more transparency amounted to a victory.
He pointed to Hirai's statement that Sony's "margins should be higher" and to "an even more exacting 'green light' process for film production, focusing more intensively on overall slate profitability as well as per film returns on investment."
"The fact that they said that is a big step," Loeb continued. "Before, if you confronted them on peer group margins, they would say those were apples to oranges comparisons."
"The only thing they rebuffed was the spin-off proposal," Loeb concluded. "They took our suggestions seriously and acted on them."
Aug 25 2014 | 11:21am ET
As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…
Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...