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Sony confirms sale of PC business, spinning-off television arm

updated 05:38 am EST, Thu February 6, 2014

Sony estimated to cull 5,000 jobs by end of financial year

Sony has confirmed it will be selling off its PC business, affecting approximately 5,000 employees in the process, in order to concentrate on its mobile business. At the same time, it has revealed it will attempt to spin off its television arm into a separate unit, as part of an aggressive reform strategy the company initially announced in April 2012.

The PC unit sale, including the VAIO brand, will be sold to Japan Industrial Partners (JIP), and though the financial details of the sale were not revealed, it is estimated to be worth up to 50 billion yen ($490 million). Under the deal, Sony will cease development of PC products, and discontinue manufacturing and sales after its Spring 2014 lineup goes on sale, though existing customers will still receive aftersales care. Between 250 and 300 Sony employees are expected to be hired by the unit once it changes hands, with other staff potentially moved to other areas in the Sony Group, or offered early retirement. After due diligence, the acquisition is expected to complete by the end of March.

Sony Vaio Tap 11
Sony Vaio Tap 11


Expected to spin off by July 2014, the TV business will become a wholly-owned subsidiary, under Sony's plans. So far, the business has secured a market share of 75 percent in Japan for high-end televisions, such as 4K models. The Ultra HD televisions are also popular in the United States, with the company claiming to have the highest market share based on revenues for the entirety of 2013. Plans for this year revolve around focusing on the high-end models, strengthening its 4K lineup and bolstering its 2K models with "wide color range and image-enhancing techniques," though in emerging markets, it hopes to launch models "tailored to specific local needs." It will continue its cost-reduction measures, in its attempts to turn around the finances of the unit.

Under the restructuring, it expects to reduce its headcount by 1,500 in Japan and 3,500 overseas positions by the end of this year. In order to continue, it is allocating an extra 20 billion yen ($197 million) to cover the restructuring expenses in 2013 financial year, and 70 billion ($690 million) for the 2014 financial year. Despite the expense, it hopes to achieve annual fixed cost reductions in excess of 100 billion yen ($986 million) starting in 2015.



By Electronista Staff
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