Sony cut its annual profit outlook due to losses related to the sale of its battery business to Murata Manufacturing, although the Japanese company had been hoping for an upward revision on sales momentum for PlayStation 4 and the launch of its virtual reality headset. Emerging from years of restructuring, the consumer electronics giant is refocusing its business to concentrate on videogames, entertainment and camera sensors and the sale of its battery business was part of that effort.
Murata Manufacturing Co., Ltd. and Sony today announced that they have signed a binding definitive agreement to transfer the Sony Group's battery business to the Murata Group. Murata and Sony had previously announced on July 28, 2016 that they had entered into a non-binding memorandum of understanding regarding the Transfer.
Under the definitive agreement, Sony will transfer to Murata the battery business conducted by Sony Energy Devices Corporation, Sony's wholly-owned subsidiary in Japan; Sony's battery-related manufacturing operations located in China and Singapore; and assets and personnel assigned to the battery business at the Sony Group's sales and R&D sites in Japan and worldwide. The sales price is approximately 17.5 billion yen. Murata is planning to offer the approximately 8,500 Sony Group employees who are involved in the battery business employment within the Murata Group upon the completion of the Transfer.
Business operations related to consumer sales of Sony-branded USB batteries, alkaline batteries, button and coin batteries, and mobile projectors, as well as certain other products, will not be part of the Transfer.
Murata and Sony are aiming to complete the Transfer by early April 2017.
While the sale to Murata Manufacturing had been flagged in July, its impact on Sony's earnings appeared to be greater than expected.
Sony now expects to post 270 billion yen ($2.6 billion) in operating profit for the year ending in March, down 30 billion yen from its previous forecast made in July and an 8 percent decline from the previous year.