TOKYO (Reuters) – Sony said on Tuesday it would convert its listed financial arm, Sony Financial Holdings, to a wholly owned unit through a bid for about 400 billion yen ($ 3.72 billion).
The deal allows the Japanese electronics and entertainment giant to strengthen its financial technology presence to compete with global technology giants such as Alibaba Group Holding and Apple.
The deal is the biggest strategic move for Sony in the presence of CEO Kenichiro Yoshida since the acquisition of $ 2.3 billion in Emmy Music Publishing, which was announced shortly after Yoshida took office in 2018.
“Financial activities have a stable profit base in Japan,” Yoshida told reporters and analysts. He said that full control of the activity “will help us to hedge against the growing geopolitical risks.”
Sony, which will change its name to the Sony group next year, already owns a 65 percent stake in Sony Financial. About 2,600 yen was offered for every share in the company that it does not own, that is, a 26 percent premium to Monday’s closing price of 2,064 yen. The bid ends in July.
Sony Financial, which is a stable source of income for Sony, has banking, life and other insurance, credit cards and nursing care activities in Japan with about 11,000 employees. Its total assets reached 14.5 trillion yen at the end of last year.
It contributed operating profit of 129.6 billion yen in the year to March, or about 15 percent of the group.
Prepared by Hala Kandil for the Arab Bulletin – Mahmoud Salama Editor