Sony Corp. plans to raise about ¥440 billion ($3.6 billion) in a sale of shares and convertible bonds to help finance an increase in production of image sensors used in smartphones.
The sale, Sony’s first since 1989, will be to the public in Japan and overseas, the company said Tuesday in a statement. Shares will make up ¥321.5 billion of the transaction and convertible bonds will account for ¥120 billion.
Image sensors, games and entertainment underpin the push to revive growth at Sony, which projects its first annual profit in three years. The company has said it’s quadrupling its investment in semiconductors to ¥290 billion this year to tap surging demand for the sensors that power Apple Inc. and Samsung Electronics Co. smartphones.
“The amount they are raising doesn’t correspond to the kind of growth we see in image sensors,” said Yasuaki Kogure, chief investment officer at SBI Asset Management Co. “This is pretty negative, and the share sell-off shows a mismatch with market expectations.”
Sony’s net cash, or cash minus debt, stood at ¥1.4 trillion as of March 31, compared with ¥826 billion in the previous quarter and ¥500 billion a year earlier.
Sony expects sales in the image censor business to climb as much as 62 percent to ¥1.5 trillion in the next three years.
Sony dropped 8.3 percent, the most since Sept. 18, to ¥3,461.5. The shares have jumped 40 percent this year, compared with a 16 percent gain in the Nikkei 225 stock average
“We have gone through a restructuring phase and are now entering into an investment stage,” the company’s spokesman Yasuhiro Okada said. The proceeds will be used to increase output capacity in the chip business, he said.
The company will use ¥25 billion in proceeds from the convertible bond sale to repay debt, it said.
The share and convertible bond sales amount to about 10 percent of the company’s current market value of about ¥4.1 trillion, according to data compiled by Bloomberg.
Advisers for the sale are JPMorgan Chase & Co., Morgan Stanley and Nomura Holdings Inc.