Tags: Sony | Morgan Stanley | Citigroup | Loeb

Sony Said to Work With Morgan Stanley, Citigroup on Loeb Plan

Thursday, 30 May 2013 12:26 PM

Sony Corp. is working with Morgan Stanley and Citigroup Inc. as it considers adopting billionaire Daniel Loeb’s proposal for a sale of its entertainment unit, said people familiar with the matter.

Third Point LLC’s Loeb is pushing Sony Corp. Chief Executive Officer Kazuo Hirai to spin off the entertainment assets, saying the move would help the company boost its stock price and raise cash. Sony stock has gained 8.2 percent since May 13, the day before reports of Loeb’s efforts surfaced.

Even with the gains, Japan’s largest television maker has lost almost two-thirds of its market value over the past five years after losing ground in TVs to rival Samsung Electronics Co. and lagging behind Apple Inc. in smartphones and tablet computers. Sony’s movie studio, meanwhile, topped the U.S. box office last year with hits such as “Skyfall.”

Shiro Kambe, a Tokyo-based spokesman for Sony, declined to comment, as did representatives for Morgan Stanley and Citigroup.

An IPO of at least part of the entertainment group would allow Sony to sharpen its focus on the electronics unit, Loeb said in a May 14 letter to Hirai. Film and financial services earnings have helped the Tokyo-based company counter nine straight annual losses from making TVs.

Loeb’s Sony stake is valued at about $1.1 billion, according to his letter, and he’s willing to bet more. The investor said he would underwrite a rights offering in the entertainment unit that would give shareholders the opportunity to participate. Third Point, which manages more than $13 billion, would be willing to buy up as much as $2 billion of the offering if there isn’t demand elsewhere, according to the letter.

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Sony Corp. is working with Morgan Stanley and Citigroup Inc. as it considers adopting billionaire Daniel Loeb s proposal for a sale of its entertainment unit, said people familiar with the matter.Third Point LLC s Loeb is pushing Sony Corp. Chief Executive Officer Kazuo...
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Thursday, 30 May 2013 12:26 PM
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