Posted on January 18, 2013 AT 04:08pm
Sony has sold its US headquarters in New York City for $1.1 billion to the Cherit Group of investors. Through the sale, Sony has repaid all its debts and will still net around $770 million in profits.The company will remain the building for another 3 years before leaving completely.
Mito Securities analyst Keita Wakabayashi states, “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.”
“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,” explains CEO Kaz Hirai.
He goes on to say, “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 stocks gained by 12% after the news was released, and the company expects $223 million in profits by March, which should reverse the losses reported by the end of the last fiscal year.
Sony is looking for new golden opportunities and, Sony Corp America president Nicole Seligman adds, “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.”
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