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Sony sells Tokyo office building for $1.2 billion in a bid to raise funds

Sony sells Tokyo office building for $1.2 billion in a bid to raise funds

By Agence France-Presse | Updated: 28 February 2013 15:44 IST

Sony said Thursday it has sold one of its main buildings in Tokyo for $1.2 billion as the embattled Japanese electronics giant offloads assets to help repair its tattered balance sheet.

The news comes after the company in January announced the sale of its US headquarters in Manhattan for more than $1.0 billion while this month it also sold part of its online medical services unit.

Sony said its had sold the 25-storey central Tokyo building, which houses its television unit, to Nippon Building Fund and an unnamed Japanese institutional investor for 111 billion yen ($1.2 billion) and would earn it a profit of 41 billion yen.

"Sony is transforming its business portfolio and reorganising its assets in an effort to strengthen its corporate structure," the company said in a statement. "This sale was conducted as a part of this reorganisation."

Sony said it would remain in the central Tokyo building for five years under a leasing agreement.

Earlier this month, the firm said it would book a $1.2 billion gain from selling part of an online medical services unit, as it eyes a full-year profit after four years in the red.

Sony has announced a massive corporate overhaul that includes thousands of job cuts, the sale of a chemical division and an investment in Olympus to tap the camera and medical equipment maker's strong foothold in the global market for endoscopes.

The maker of Bravia televisions and PlayStation games consoles lost 456.66 billion yen in the last fiscal year, but says it is on track for a 20 billion yen net profit in the year to March.

Last week, Sony announced it would launch its PlayStation 4 system as it faces increasing competition from cheap or sometimes free downloadable video games for smartphones and tablets.

The company's hard times saw its stock value tumble below 1,000 yen a share last year, for the first time since the era of the Walkman.

The stock has since come back, with Sony shares up 3.56 percent at 1,338 yen on Thursday in Tokyo.

Japan's electronics sector has suffered myriad problems including a strong yen, slowing demand in key export markets, fierce competition especially in the struggling TV division and strategic mistakes.

The industry has been awash in huge losses and credit rating downgrades, with rival Sharp saying last year it would put up real estate as collateral for bank loans including its Osaka headquarters to stay afloat.

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