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Forums - Sony - Sony to sell $1.9bn of conv bonds, stock down 10% in early trading.

sales2099 said:
VicViper said:
In some other thread someone mentioned Google buying Sony

Does this hold any truth?

Hell MS can buy Sony if its only worth $12 billion.

You get your entertainment hub for Xbox with Sony music and movies and win the console war in one shot. Scrub the rest/sell them off piece by piece. A man can dream.

Err, yeah, then you get Sony and untold billions in debt, I think MS will pass, and rightly so.



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CChaos said:
kowenicki said:
CChaos said:
Well, I think one thing we can all agree on, wholeheartedly, is that the Sony of the future will be a different beast than the Sony of today. It's strange to think about, considering most of us have grown up around Sony products, but this is going to come down to a few very important points that go beyond things like the game division.

1) Can they profit enough in the short term to not only break even, but to break even enough to pay off their mass of debts?
2) What will stay and what will go? Extreme measures require extreme choices. This does mean that they might be forced to kill or sell entire divisions. The death of the Sony TV could still be possible.
3) How are they going to streamline for the future?

At least most people aren't using the infuriating term that 'Sony is too big to fail' any more. Kaz appears awake and I'd bet you good money now that the engineers and executives have put down this 'us vs. them' attitude for the sake of mutual survival. It's not until people start realizing the potential threats that they start working their asses off to prevent it. I think it's safe to say the realizations have kicked now. Now to see what they do about it.

Good summary.  Sony are currently in a phase of downsizing, I think if may well accelerate. Sony of tomorrow will be significantly smaller than Sony of yesterday. 

I couldn't agree more. And they probably need to be smaller. See, one needs to consider the variation in companies as well.

Consider, if you will, the Western vs. the Eastern company.

Western companies (and now certain Eastern ones) seem to have a good idea that mobility is the key to survival in the world of business. When something starts to shift, they are quick to try and take advantage of it while also speedy in stemming the blood flow of the wounded parts of their own corporation. They raise and shut wings with impunity, for the best of the company.

(Mostly older) Eastern companies are monolithic in nature. They are massive, monstrous structures. At one point, Sony, Panasonic and Sharp were the eidolons. They were the ideal of what makes for success. Truly amazing companies back until the 2000s, when they all started dropping. When Sony started losing money on their TV division, they doubled down to tough it out. This is why that division hasn't been in the black for eight years. A western company would have downsized the crap out of it and, if it didn't make money, would have liquidated it and moved on. Sony couldn't do that because it has its tradition in televisions. They wanted it to succeed, but have been slogging hard for years to get it back to simple profitability. They aren't the drop and run types, basically.

Basically, what people are seeing here is Sony in the pains of trying to shed its skin through Kaz. Looking at Sharp and Panasonic, this is not an easy change, but Sony needs to shift its behemoth nature to something closer to modern needs if it's trying to survive. As such, you see the titans of Japanese business basically on the ropes and trying to shift enough to stick it out. Sharp probably won't survive. Panasonic might, but that's a big if. Sony...hard to tell either way right now.

Basically, we're in the middle of watching a truly bizarre shift of corporate nature. A historic shift, perhaps.

I think that's largely because Asian buisness culture is mostly that of treating a large company as if it were actually multiple small companies.



Japanese companies work more like an oldschool fuedel country, each independent trying to win or lose influence to control "Tokyo" as it would.

This is also problematic just in that it greatly hurts company synergy since each branch is seen more as a competitor to be heir then an ally.  They will cooperate but only if both sides get something out of the deal.  One branch is unlikely to sacrifice for another branch.



Kasz216 said:

Keep in mind... in a takeover you have to offer more then the current share price by quite a bit usually.   Not to mention Sony would likely insitute a "poison pill" option.


Oh yeah forgot that :(
But AMD also isnt doing well right now ... there are rumors for AMD to be sold ... maybe that would be a better investment for ms

But buying shares for sony right now would be not a wise idea and the chances that you will make profit in the near future is slim.



Kasz216 said:
I think that's largely because Asian buisness culture is mostly that of treating a large company as if it were actually multiple small companies.



Japanese companies work more like an oldschool fuedel country, each independent trying to win or lose influence to control "Tokyo" as it would.

This is also problematic just in that it greatly hurts company synergy since each branch is seen more as a competitor to be heir then an ally.  They will cooperate but only if both sides get something out of the deal.  One branch is unlikely to sacrifice for another branch.

Exactly. This is why I compare them to a monolithic structure. This has already shown that it's not going to be easy for them and it's a matter of seeing in what shape they manage to survive the change. This is a pretty extreme shift, because Kaz is going to have to take control of everything. He's going to need to be the CEO who conquers the fiefdoms for the recreation of the whole.

At the same time, the creators of Sony were all about independence and creativity. I imagine the engineers are going to see this as a betrayal, but one needs to do what they can to shift to a new method of structure and profitability. I don't envy the poor bastard at all.



CChaos said:
Kasz216 said:
I think that's largely because Asian buisness culture is mostly that of treating a large company as if it were actually multiple small companies.



Japanese companies work more like an oldschool fuedel country, each independent trying to win or lose influence to control "Tokyo" as it would.

This is also problematic just in that it greatly hurts company synergy since each branch is seen more as a competitor to be heir then an ally.  They will cooperate but only if both sides get something out of the deal.  One branch is unlikely to sacrifice for another branch.

Exactly. This is why I compare them to a monolithic structure. This has already shown that it's not going to be easy for them and it's a matter of seeing in what shape they manage to survive the change. This is a pretty extreme shift, because Kaz is going to have to take control of everything. He's going to need to be the CEO who conquers the fiefdoms for the recreation of the whole.

At the same time, the creators of Sony were all about independence and creativity. I imagine the engineers are going to see this as a betrayal, but one needs to do what they can to shift to a new method of structure and profitability. I don't envy the poor bastard at all.

It's really hard to see when Stringer already tried and failed. 

Perhaps Stringer was too lenient though and/or just had too little cred due to not being Japanese.



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kowenicki said:
Markets see this for what it is. stock down 10% so far today!

Lowest for decades. Market cap now just $9.8bn, under $10bn seems unreal.

Does mean nothing, everything will be fine...Serious what the markets?  Let the specialist on Neogaf do the talking.



 

I seriously think that the government of Japan should devalue their currency. Their whole electronics industry is choking to death under the growth of the yen, and apparently they can't take their manufacturing to China without facing race riots.



"The worst part about these reviews is they are [subjective]--and their scores often depend on how drunk you got the media at a Street Fighter event."  — Mona Hamilton, Capcom Senior VP of Marketing
*Image indefinitely borrowed from BrainBoxLtd without his consent.

Sony's total debt is over $14B. It's value is under $10B. Google, Microsoft nor anyone else is going to take on $14B of debt for $10B of value.



TheLastStarFighter said:
Sony's total debt is over $14B. It's value is under $10B. Google, Microsoft nor anyone else is going to take on $14B of debt for $10B of value.

Actually, as of June 2012, Sony has $135 billion in total liabilities (debt) compared to $166 billion in assets at that time. 0.8005 debt to equity ratio.

EDIT: I should probably explain further: equity is basically the amount left after you subtract liabilities from assets. Capital intensive companies often have really high ones because of borrowing, but a fairly healthy one for a corporation that isn't based off of borrowing is below 0.5.



Lusche said:
Kasz216 said:

Keep in mind... in a takeover you have to offer more then the current share price by quite a bit usually.   Not to mention Sony would likely insitute a "poison pill" option.


Oh yeah forgot that :(
But AMD also isnt doing well right now ... there are rumors for AMD to be sold ... maybe that would be a better investment for ms

But buying shares for sony right now would be not a wise idea and the chances that you will make profit in the near future is slim.


There are different rumors about MS buying someone big every day. The most likely ones are Nokia and Nvidia. Well after Skype last year with 7 billion USD, Sony is easily possible, but it won't happen, because Sony will do everything they can to protect their company and MS won't buy a Japanese company (IMO)



Imagine not having GamePass on your console...