Jana, Sandell Launch Offensive Against CNET

Jan 7 2008 | 1:11pm ET

Annoyed by its poor stock performance, activist hedge fund manager Jana Partners today launched a bid to take control of Internet media group CNET Networks.

The New York-based firm, backed by fellow hedge fund Sandell Asset Management, said it plans to nominate a pair of candidates to challenge the two CNET board members up for reelection at the company’s next annual meeting. It also plans a push to add five seats to the CNET’s board—which currently numbers eight directors—in an effort to gain control.

Jana complains that CNET’s performance is not up to snuff, pointing both to a 19% decline in stock price between 2005 and last year, as well as last year’s less than 1% return. The hedge fund owns an 8% voting stake and a similarly-sized non-voting stake in the company. Sandell owns a 5% non-voting stake in CNET.

San Francisco-based CNET quickly responded to Jana’s intrigues, calling its proposal “improper under the company’s bylaws” and arguing that “no person or group of persons should be able to gain a majority of the board and control of the company without offering sufficient value to all stockholders.” CNET rebutted Jana’s allegations of poor performance, saying it “has made significant strategic, financial, personnel and operational progress” since last year. It also noted that seven of the company’s eight directors are independent, and that management “is fully supported” by the board.

Jana has already fired the first salvo, with an affiliate filing suit to prevent CNET from junking its nominees based on its bylaws.


In Depth

Part II: Roubini Talks Risk, Recovery And The Threat Of A Triple Dip Recession

Oct 21 2014 | 12:41pm ET

In the second half of our interview with Nouriel Roubini, FINalternatives editor...

Lifestyle

Balyasny Pays Over $6M For Lakefront House

Oct 22 2014 | 10:29am ET

A venture headed by hedge fund manager Dmitry Balyasny just paid $6.2 million for...

Guest Contributor

Hedge Funds Weather A Data Management Perfect Storm

Oct 22 2014 | 12:28pm ET

From a regulatory standpoint, nearly every development since the crisis has placed...

 

Videos

Editor's Note

    Guidelines for Guest Articles

    Oct 22 2014 | 9:46am ET

    We are always looking for guest articles from hedge fund managers and buy-side firms.

    If you are interested in submitting a contributed piece for possible publication on FINalternatives, please take a look at the specs. Read more…

 

Futures Magazine

October 2014 Cover

Deeply flawed risk benchmark

Most traders agree that proper risk management is the key to successful trading. However, many traders depend on the deeply flawed measure of standard deviation as a benchmark of risk. Here we put it ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.