CNET's Response to Jana: Thanks, But No Thanks, You Fibber!
After dissident shareholders, led by Jana Partners, landed one right in the kisser to the board and management of CNET Networks yesterday–releasing a 38-page report that essentially called the company’s leadership incompetent, the tech news and review site gave the literary effort a kiss-off of its own.
First, rather politely, CNET said that Jana’s proposed strategies, which called for a major overhaul of all aspects of CNET’s operation, “will be carefully reviewed. To the extent there are any new strategies that would create stockholder value, they will be implemented.”
But wait for it!
The statement continued: “CNET Networks added that while it welcomes the views of its stockholders, after a preliminary review, the white paper contains numerous misstatements and is misleading in many respects. The Company will respond in due course.”
BoomTown looks forward to that response, especially since the Jana group pulled no punches in its initial parry, writing in the report:
“The current leadership of CNET Networks Inc. (“CNET” or the “Company”) has presided over massive value destruction…CNET’s current leadership now claims it can reverse course and begin creating shareholder value, but we believe they have offered no evidence that they can do so. Despite years of shareholder value destruction, CNET’s leadership during this time failed to act on the urgent need to make fundamental strategic and operational change, instead pursuing a failed expansion strategy even as CNET fell further behind…In addition, we believe CNET’s Board and senior management lack the industry-specific experience and expertise to stop this shareholder value destruction.”
And did they mention “value destruction”?