The chief executive of Sony has said that the spin-off of its financial services arm will help the tech giant protect its fundraising capabilities.
The comments come after Sony recently announced plans to spin off Sony Financial Group (SFG) with a direct listing in the market.
According to the company, the move marks the first partial spin-off by a business in Japan with a direct listing in over 20 years.
At an investor day on Thursday, Hiroki Totoki discussed the financial services spin-off as well as the growth strategy for the business arm, the company’s long term-strategies, and priorities as part of its fiscal year 2024 earnings announcement.
“It is significant that, through the spin-off, Sony (Financial Group) will secure its own fundraising capabilities while continuing to use the Sony brand and collaborate with Sony Group,” he said.
The move will see Sony Group distribute just over 80 per cent of its shares to SFG to shareholders through dividends in kind.
It also confirmed plans to complete the spin-off listing in September 2029, with SFG planning to repurchase shares totalling around 100 billion yen through to March 2027.
Sony said the value creation for SFG includes rebuilding Sony Life’s portfolio and establishing a management strategy that will drive growth.
“Since its founding in 1979, Sony Life has provided customised insurance products based on consulting rather than product-oriented sales, offering new value to customers and bringing “a breath of fresh air to the industry,” Totoki said.
“While continuing to implement fundamental measures, we will work to generate stable cash flow and actively return profits to shareholders.”
He added that even after the partial spin-off, the business unit will be able to continue using the Sony brand, with the SFG planning to leverage Sony Group’s strengths in entertainment and technology to promote inter-business collaboration.
The long-term plans of the business unit also involve accelerating investment in growth, including through M&A, while also developing both new markets and new financial services.
Totoki highlighted Sony’s years-long directional shift to entertainment, content and creation as “transformational” for the company, leading to strong results.
According to its earnings report, more than 60 per cent of Sony’s revenue came from its entertainment businesses in 2024.
“Building on our momentum and results to date and working with a laser-like focus to realise our long-term Creative Entertainment Vision will be at the core of our corporate strategies moving forward,” commented Totoki.
