Sony Group (SONY) Plans Major Change for Financial Group

Sony Group Corporation (NYSE:SONY) is one of the 13 Best Japanese Stocks to Buy According to Hedge Funds. On May 29, Reuters reported that Sony Group Corporation’s (NYSE:SONY) CEO, Hiroki Totoki, said that spinning off the group’s financial services arm will allow that business to raise its own funds.

He also pointed out that even after the spin-off, the financial group will keep using the Sony brand and continue working with Sony Group Corporation (NYSE:SONY).

The financial group includes banking and insurance. Sony Group Corporation (NYSE:SONY) plans to distribute just over 80% of its shares in the financial group to shareholders as dividends in kind.

This is the first time in over two decades that a Japanese company is doing a partial spin-off with a direct listing. The listing is planned for September 29.

The financial group intends to buy back shares worth about 100 billion yen by March 2027. Totoki noted that the financial services business will need to invest in its IT systems and make strategic investments, such as mergers and acquisitions, in the medium-to-long term.

In recent years, Sony Group Corporation (NYSE:SONY) has sold off some of its hardware operations to focus more on entertainment, which includes the company’s PlayStation games business. Last year, over 60% of Sony Group Corporation’s (NYSE:SONY) profits came from its entertainment business.

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Disclosure: None. This article is originally published at Insider Monkey.