Investors led by the Cherit Group have agreed to buy Sony’s 37-story US headquarters for $1.1bn.
Bloomberg reports that, once Sony has repaid debts associated with the property, the company will net around $770m from the sale. Sony will remain in the building for three years.
Mito Securities analyst Keita Wakabayashi says that the deal seems prudent, providing Sony invests in the cash correctly: It makes sense for Sony, as it’s no longer a cash-rich company. What matters is whether the company can use these proceeds to develop more attractive products.”
The move comes as Sony CEO Kaz Hirai told the Associated Press that he is overseeing the transition to a leaner, faster-thinking structure of the company.
"I’m shepherding several of those projects personally myself to make sure that it doesn’t get held up in the bureaucracy, or it doesn’t suddenly fade away in the approval process," he explained.
"Sony needs to show that it is showcasing its unique imagery technology, not doing something everyone is doing. It needs to create new sectors in the electronics market. Otherwise, it’s stuck fighting over the crumbs of the same pie.
"We need to be a lot faster in decision making. We need to be a lot faster in execution. We need to be passionate about our product. Are we perfect? No. But I think we’ve improved significantly."
Sony shares surged 12 per cent on the news. The company currently predicts a $223m profit for the year ending March, reversing the colossal losses reported in the last financial year.
Sony is on the hunt for new premises, with Sony Corp America president Nicole Seligman adding: Given the opportunities and challenges in the current economic and real estate landscape, selling 550 Madison now is a timely and logical strategic move. Regarding our new headquarters, we continue to look at a number of spaces in Manhattan but have not yet made a decision about where to lease.”