Viacom Critic SpringOwl Seeks Big Changes With Small Stake

  • Investment group called on Viacom to change its leaders, board
  • 99-page report says company has trailed competitors' returns

Viacom Inc.’s loudest critic is one of its smallest investors.

SpringOwl Asset Management LLC, the New York-based investment firm calling for major changes at the owner of MTV and Nickelodeon, owns 8,882 Viacom Class B shares as of Dec. 31, worth just over $300,000, according to a regulatory filing Tuesday. It isn’t one of the media company’s 500 largest shareholders, according to data compiled by Bloomberg.

Activist investors usually hold a larger stake in a target company. SpringOwl has proposed Viacom replace its leaders, merge with other companies and cut staff. The calls coincide with turmoil at Viacom, where founder and controlling shareholder Sumner Redstone, 92, stepped down as chairman this month. The board elected Chief Executive Officer Philippe Dauman to succeed him, with Redstone’s daughter, Shari, casting the lone dissenting vote.

Top Holders of Viacom Voting Stock

Investor Voting
National Amusements 79.9%
Gamco 10.0
Neuberger Berman  1.4
Longview Partners  1.2
Gruss Capital  0.6

The filing doesn’t reflect all of the holdings of SpringOwl’s principals, according to Eric Jackson, a managing director. Jackson helps oversee a new entity, SpringOwl Event Driven Partners, which acquired more Viacom shares in January. It isn’t obligated to disclose holdings because it manages less than $100 million, he said.

“It’s a substantial position for us,” Jackson said in an interview. The money manager, who issued a 99-page report detailing his objections to Viacom’s management, said he would continue to “speak out and keep pressing the company.” He hasn’t decided whether he will attend the company’s annual shareholder meeting in March.

The New York-based firm, founded in 2013, has previously targeted Yahoo! Inc. The effective date of the filing was Dec. 31. Viacom Class B shares rose 4.5 percent to $34.29 at the close in New York. The nonvoting stock has declined 17 percent this year.

Viacom declined to comment.

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