An investor of Viacom, Inc. (NASDAQ:VIAB) and Yahoo! Inc. (NASDAQ:YHOO) has urged both firms to strategically consider external investors who invest like Warren Buffet so they can boost the value of their stocks.
Eric Jackson, the managing director of SpringOwl Asset Management, told Viacom and Yahoo that attracting outside investment would be advantageous. He even cited an example of how Goldman Sachs Group Inc (NYSE:GS) survived the financial crisis thanks to Warren Buffet’s investment worth $5 billion.
Mr. Jackson also added that most of the stockholders of both firms believe that separating the two companies would be the best way to inflate the investor value. He, however, stated that each company would reap heavy gains if they adopted the external investor strategy. He further pointed out that external investors would dilute the investor stakes but, either way, it would still be advantageous for each firm because the external partners would most likely drive up the share value.
Neither of the two companies has made a statement with regards to Mr. Jackson’s proposal. Yahoo has been under a lot of pressure to dispose its main business and cut ties with its Asian assets. The company had a poor performance last year with shares dropping by 40%. Viacom, on the other hand, has been clouded by a lawsuit demanding the Executive Chairman Sumner Redstone to step down.
Jackson feels that Yahoo should divert its attention to other firms such as AT&T Inc. (NYSE:T), Verizon Communications Inc. (NYSE:VZ) and Liberty Media Corp. John Malone from Liberty Media is particularly known for his skill in seeking out tax efficiencies.
He also suggested that Viacom would benefit from knowledge and investment in AMC Entertainment Holdings Inc (NYSE:AMC) or Alibaba Group Holding Ltd (NYSE:BABA). He believes that Viacom-owned Paramount Movie Studios would be more attractive to investors if it had the backing of corporate investors such as Apple Inc. (NASDAQ:AAPL), Alphabet Inc (NASDAQ:GOOGL) or Alibaba.