In a 2009 book, “Curse of kate spade outlet online
Mogul”, Jonathan Knee, Bruce Greenwald and Ava Seave analysed media
conglomerates’ chronically poor performance, blaming it mainly on their
bosses’ appetite for trophy assets that buy them power and visibility.
This propensity for big, dumb deals has hurt investors: AOL’s disastrous
merger with Time Warner and News Corp’s purchase of Dow Jones in 2007
for around $5.6 billion?more than double its market value at cheap kate spade outlet
time?are two examples. In kate spade on sale
ten years to 2005, four large media conglomerates, News Corp, Viacom,
Disney and Time Warner, together produced returns one-third of kate spade online
average for firms in kate spade new york designer handbags
S&P 500 index. Between 2000 and 2009 they had to write down $200 billion in assets.
More recently, media firms have sparkled. In kate spade handbags past month yoga lululemon clothesworkout clothes shares of some firms have reached all-time highs, and over yoga lululemon clothes past five years News Corp, Viacom, Disney and Time Warner have each delivered more than twice lululemon yoga outlet S&P 500’s average return of 6.1%. Part of this is due to investors calming down about lululemon outletworkout clothes immediate threat of Netflix and other disrupters to pay-TV. But it is also in part due to a change in media moguls’ behaviour.
In most businesses, conglomerates went out of favour after yoga lululemon clothes 1980s. But media bosses, always fashionably late to parties, have taken several decades to follow. Their recent disposals of non-core assets have helped win over distrustful shareholders. “Investors like to own a business they can understand,” says Philippe Dauman, kate spade outlet boss of Viacom. (His firm launched kate spade outlet online trend of deconglomeration when it separated its broadcast-TV and other businesses into CBS Corporation in 2006.) Most shareholders now see that television networks, newspapers, film studios, music labels and other sundry assets add little value by sharing a parent. Their proximity can even hinder performance by distracting management.
Each media firm has had its own reasons for offloading assets, but there are some shared themes. Shareholders have become more assertive and less likely to believe cheap kate spade outlet moguls’ flannel about “synergies”. In particular they are more sceptical that makers of content and hardware belong together. This week Dan Loeb, a hedge-fund manager, raised his stake in Sony, a Japanese electronics and entertainment firm, and is pressing its managers to spin off kate spade on sale film studio and music business. Making “Skyfall” is a different business from manufacturing a television.
More recently, media firms have sparkled. In kate spade handbags past month yoga lululemon clothesworkout clothes shares of some firms have reached all-time highs, and over yoga lululemon clothes past five years News Corp, Viacom, Disney and Time Warner have each delivered more than twice lululemon yoga outlet S&P 500’s average return of 6.1%. Part of this is due to investors calming down about lululemon outletworkout clothes immediate threat of Netflix and other disrupters to pay-TV. But it is also in part due to a change in media moguls’ behaviour.
In most businesses, conglomerates went out of favour after yoga lululemon clothes 1980s. But media bosses, always fashionably late to parties, have taken several decades to follow. Their recent disposals of non-core assets have helped win over distrustful shareholders. “Investors like to own a business they can understand,” says Philippe Dauman, kate spade outlet boss of Viacom. (His firm launched kate spade outlet online trend of deconglomeration when it separated its broadcast-TV and other businesses into CBS Corporation in 2006.) Most shareholders now see that television networks, newspapers, film studios, music labels and other sundry assets add little value by sharing a parent. Their proximity can even hinder performance by distracting management.
Each media firm has had its own reasons for offloading assets, but there are some shared themes. Shareholders have become more assertive and less likely to believe cheap kate spade outlet moguls’ flannel about “synergies”. In particular they are more sceptical that makers of content and hardware belong together. This week Dan Loeb, a hedge-fund manager, raised his stake in Sony, a Japanese electronics and entertainment firm, and is pressing its managers to spin off kate spade on sale film studio and music business. Making “Skyfall” is a different business from manufacturing a television.
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