CNET and Jana: The Battle Drags On
In another micro-move in the fight between activist shareholders and CNET, the Delaware Supreme Court has given the thumbs-up to a lower court ruling that the Jana Partners group can nominate a slate of directors to the board of the San Francisco-based tech news and reviews site.
CNET (CNET) has been fighting these efforts by Jana–along with Sandell Asset Management, Alex Interactive Media, Spark Capital and Velocity Interactive Group–to nominate two directors and expand the board and add more of their own nominees–claiming it was contrary to its bylaws.
What does this mean? Of course, that’s not clear at all, since Jana cannot force other shareholders to help them get what they want.
In fact, some other CNET shareholders I have queried recently seem nonplussed by either side in the fight over the future direction of CNET.
But while the mano-a-mano between the pair is certainly not as fast-moving as the Yahoo-Microsoft-and-now-Carl Icahn! mess, it has had some action.
On April 1, for example, Jana issued a testy report about the company, noting:
“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. CNET’s leadership did not even start examining the basics of improving performance until we called for change, both publicly and directly with CNET’s Board of Directors.”
CNET, natch, disagreed: “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.”
Of course, BoomTown is poised to head over to CNET’s Second Street HQ to video-query CEO Neil Ashe tout de suite.
Neil, we’re waiting by the phone!