New York - A group of investment funds led by Jana Partners has taken a 21% stake in technology publisher CNET Networks (NASD: CNET), and is seeking to oust the company's current directors and take a majority of its board, The New York Times reported, citing people briefed on the proposal. Other entities involved in the proposal -- which CNET has rejected, sources told The Times -- include Sandell Asset Management, Spark Capital and entrepreneur Paul Gardi.

In a statement, CNET called the Jana-led proposal "improper" under the company's bylaws, which state that no shareholder can propose to amend them without having owned $1,000 in shares for at least a year.

None of the entities involved in the proposal to expand CNET's board from eight to 13 members fit this stipulation; The Times reported that the investors plan to file a legal complaint to prevent CNET from rejecting its nominations of new directors.

CNET, a veteran technology news publisher founded in 1992, has seen its share price decline 19% over the past three years, while its Web traffic has also been shifting to smaller, niche-oriented news sites.

Related Links:
http://www.nytimes.com/2008/01/07/technology/07shareholders.html

http://snipurl.com/1wti5

http://www.cnet.com