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Sony Corp in talks with investment fund to divest Vaio PC division- source

February 5
7:34 AM 2014

A source told Reuters that Sony Corp is discussing a possible sale of its loss-making Vaio personal computer division with the investment fund Japan Industrial Partners. The person familiar with the matter said that based on the plan that is still being evaluated, a new firm would be established by the investment fund to assume the operations of the Vaio brand in Japan. The companies are still threshing out financial details and shareholdings, the report said.

The source added that Sony is thinking of withdrawing from PC markets abroad. With mobile devices like tablets and smartphones fast gaining popularity, traditional PC sales are declining. Citing figures from research firm Gartner, the report said PC shipments worldwide are expected to decrease 7% this year to 278 million units compared to last year. Gartner added that shipments of mobile phones are expected to reach 1.9 billion this year, representing a 5% rise from 2013.

According to The Nikkei business daily, the Vaio PC business would have a price tag of as much as JPY 50 billion or $493M with Sony keeping only a minute share in the new firm. The Nikkei added that divesting the PC unit would cause disposal losses that would prompt Sony to report a net loss for the year that ends in March 31, the company's first in a couple of years. Sony is expected to post its quarterly results on Thursday, February 6, the report said.

According to a report by Bloomberg, a memorandum for the sale may with the buyout firm may be released as early tomorrow. The Bloomberg source also said that Japanese firm may also unveil a restructuring program that would involve reducing its workforce as it mulls on the next steps for its PC operations worldwide.

Daiwa Securities Group Inc Analyst Junya Ayada told Bloomberg in an interview, "Selling the PC operation is positive for Sony in the long term. The PC is being robbed of the consumer market by tablet computers."

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