Sony to Possibly Spin Off Its Entertainment Division

Sony to Possibly Spin Off Its Entertainment Division

Japanese electronics and entertainment giant Sony may be considering spinning of its entertainment division in order to help its electronics division to compete more efficiently against Apple and Samsung.



The news that Sony’s entertainment division could soon be spun off emerged on Wednesday, when Sony CEO Kazuo Hirai revealed that the board would consider a proposal put forward by U.S. hedge fund manager Daniel Loeb, who runs Third Point LLC. Loeb suggested last week that Sony sell off or spin off its entertainment division — which includes movies, music, and television — in order to shore up its electronics manufacturing unit.

Under the proposal, Sony would sell 15 to 20% of its entertainment business in a public offering that would result in a separately listed company.

“This will be deliberated by the board,” Hirai told reporters, according to Reuters. “We have only just begun to study this.”

If Sony were to go through with their plan, the most likely result would be the entertainment business being made public, but the unit would not operate as a separate entity.

Sony’s entertainment division made $862 million in operating profit last year, that’s almost as much as the company’s consumer electronics division lost.

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