Sony officials have confirmed details of an IPO (initial public offering) for the company’s insurance unit, which is expected to be the largest IPO in Japan this year. Around ¥332 billion ($2.9bn) worth of shares will be sold, part of the profits from which are expected to be passed onto the games division.
The insurance unit was first started in 1979 as a venture of Sony Corp. and Prudential Insurance, and now includes Sony Life Insurance, automobile insurer Sony Assurance and online bank Sony Bank. The unit’s net income fell 13 percent to ¥10 billion ($86.5m) in the last financial year.
According to
a Bloomberg report, Sony will sell 725,000 shares, around 34.5 percent of Sony Financial Holdings Inc., with the unit also offering 75,000 new shares. Analysts have already speculated that the profits received from the IPO will be used to increase production of Bravia HD televisions and help the currently unprofitable PlayStation unit.
“Sony could use the funds for various options to strengthen its electronics and game businesses,'' quotes Bloomberg of analyst Mitsuhiro Osawa from Mizuho Investors Securities Co. “A cut in the price of the PlayStation 3 is one option”, he added.
