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Sony Corp Unveils Plan to Raise $3.6 Billion via International Stock and Bond Offering; Shares Drops Sharply

Japanese giant plans to increase production capacity of stacked CMOS censors in Devices segment

| June 30, 2015 @ 7:09 AM
Kaz Hirai Sony

Sony

Sony Corp shared plans early on Tuesday to raise $3.6 billion (440 billion Yen) through the issuance of new shares, all a part of its ongoing Mid-Term Corporate Strategy.

The overseas stock market did not react favorably to the news, as share prices plunged more than seven percent following the announcement. (See the chart posted below.)

“The purpose of this fund raising is to secure funds to invest in growth and to strengthen Sony Corporation’s financial base,” the company said in a Tuesday filing. “Sony Corporation believes that investment in growth, as well as strengthening its financial base through this fund raising, will contribute to further enhancement of Sony Corporation’s profitability.”

Sony is set to issue 87.2 million shares of common stock (SNE) in Japan and overseas. A secondary offering of 4.8 million shares will be introduced in Japan. The stock issuances should raise 321 billion Yen, per the company, with a convertible bonds offering adding another 119 billion Yen.

Also Read: 11 Sony Hack Shockers From Explosive Fortune Magazine Cover

Sony plans to use the money from the issuance of new shares to increase its production capacity of stacked CMOS censors in its Devices segment, which it hopes will lead to additional profits. Further, the company wants to use the funds raised by the convertible bonds portion against capital expenditures for the segment and the repayment of debts.

Specifically, Sony aims to use about 188 billion Yen from the common stock offering to fund capital expenditures in the Devices segment, and the remainder to fund R&D there. From the convertible bonds issuance, Sony will use 51 billion Yen to fund capital expenditures on devices, 25 billion Yen to redeem outstanding bonds upon maturity, and the remainder to repay longterm debts.

As of May 31, Sony Corp had about 1.170 billion shares outstanding. At the end of this fund-raising period, the company will have approximately 1.262 billion shares outstanding.

Also Read: Sony Hack: Ex-Employee Negligence Suit Moves Ahead With Judge's Approval

Since the stock plunged after hours, SNE has rallied a little bit. The fall is perhaps most easily seen when plotted on a one-month chart, such as the below:

SNE

Sony Hack Attack Timeline: From First Cyberbreach and Leaks to 'The Interview' Release (Photos)

  • Michael Lynton The Grill
  • sony hack email nightmare
  • Sony Pictures
  • Sony
  • James Franco, Seth Rogen, "The Interview"
  • James Franco, Seth Rogen
  • Amy Pascal and Michael Lynton
  • Sony Chiefs Amy Pascal, Michael Lynton 'Deeply Saddened' Over Hacking Attack
  • Sony Pictures
  • Sony's logo on a wall
  • "hacked by #GOP" message found on Sony computers
  • Sony's logo on a wall
  • Sony Chiefs Amy Pascal, Michael Lynton 'Deeply Saddened' Over Hacking Attack
  • Tom Hanks
  • Amy Pascal, Steve Mosko of Sony
  • Sony's logo on a wall
  • Sony Marketing Layoffs
  • Sony Pictures
  • Movie posters for the premiere of the film 'The Interview' at The Theatre at Ace Hotel in Los Angeles, California on December 11, 2014. The film, starring US actors Seth Rogen and James Franco, is a comedy about a CIA plot to assassinate its leader Kim Jong-Un, played by Randall Park. North Korea has vowed 'merciless retaliation' against what it calls a 'wanton act of terror' -- although it has denied involvement in a massive cyber attack on Sony Pictures, the studio behind the film. AFP PHOTO/STR (Photo Credit: Getty Images)
  • The Throwaways
  • Skyfall Daniel Craig James Bond 25
  • sony hack email nightmare
  • ArcLight Cinemas
  • Sony Chiefs Amy Pascal, Michael Lynton 'Deeply Saddened' Over Hacking Attack
  • Sony's logo on a wall
  • The Interview movie poster, Sony logo, President Obama
  • the interview hollywood tweets
  • Team America World Police
  • The Interview movie poster, Sony logo, President Obama
  • Mike Myers as Dr. Evil on "The Interview."
  • reince priebus chief of staff donald trump health care bill punt end zone football twitter
  • Sony attorney David Boies
  • sony hack email nightmare
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As Sony CEO Michael Lynton prepares to exit, here’s TheWrap’s blow-by-blow of 2014’s devastating cyberattack on the studio

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