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Leaked Sony emails show Loeb influence on studio execs

By Ritsuko Ando and Svea Herbst-Bayliss TOKYO/BOSTON (Reuters) - Sony Corp movie executives kept up a dialogue with hedge fund titan Daniel Loeb, even after rebuffing the billionaire investor's proposal to sell up to one-fifth of the studio's entertainment business, leaked emails show. Loeb's New York-based Third Point took a 7 percent stake in the company in May 2013 and suggested that proceeds from a sale could be used to overhaul Sony's struggling electronics business. For months, Loeb, who is closely watched in the hedge fund industry because of his fund's strong returns and pointed messages to chief executives, tried to persuade the company to do what he thought was best. Even after his proposals were official rejected in August 2013, he held the stock for roughly another year, telling investors in October 2014 that his $18 billion firm had exited the position during the third quarter. Having already forced a board room reshuffle at Yahoo Inc, Loeb has in the last few months actively pushed for change at Sotheby's, where he won board seats and the chief executive resigned in November. He has also pushed Dow Chemical Co and Amgen Inc to consider splitting themselves apart. Known for his sharp tongue, Loeb has penned pointed letters to underperforming chief executive officers and other top managers. But investors say he has worked on being more congenial in the last months. The emails, made available online following a massive hack into networks at Sony's film subsidiary Sony Pictures Entertainment, showed its executives carefully weighed how to deal with Loeb's overtures. The documents released by the hackers shed light on Sony's plans and business future. Loeb met with Sony Entertainment Chief Executive Michael Lynton in early January in Las Vegas, during the Consumer Electronics Show (CES), the emails show. In April, Lynton asked Sony Entertainment President Nicole Seligman whether he should invite Loeb to a Spider-Man film premiere, or arrange a meeting. "Should I try and see him when I am in NYC next Thursday?" he wrote in an email in April. He also asked Jeff Blake, Sony Pictures' vice chairman at the time, whether tickets for the premiere were available for Loeb. "My instinct is to stay off his radar," Seligman advised. Loeb, at times, tried to show his support for Sony. In a January 12, 2014 email, Loeb sent Lynton a link to a New York Post article in which he praised Sony products. The report in what Loeb jokingly refers to as New York's "newspaper of record" quotes Loeb gushing over Sony's TVs and phones shown at CES. "For the first time in a while, it feels like they're competing against Samsung again," he was quoted as saying. Activist investors like Loeb are often in close touch with executives at their target companies, sending both supportive and critical messages, industry analysts have said. Emails in September showed Loeb tried to broker a meeting between Sony and Lions Gate executives to discuss a possible merger and acquisition deal. Sony Corp Chief Executive Kazuo Hirai turned down a meeting with Lions Gate Vice Chairman Michael Burns, saying "I don't believe a meeting with me would be fruitful or a good use of your time," but refers him to Lynton and Seligman. The emails also showed pressure from Loeb influenced some decisions within Sony, including a possible appointment of media executive Strauss Zelnick to a key post. It was unclear what the position was for. A human resources official at Sony emailed Lynton in February to say a "nominating committee" would still keep Zelnick on its list, but that "the importance on entertainment background has decreased slightly according to the shift of focus/interest from Dan Loeb." Sony declined to comment on the hacked emails. Zelnick did not immediately respond to a request for comment. (Additional reporting by Svea Herbst-Bayliss, James Pearson, Lisa Richwine and Jim Finkle)