FILE PHOTO: The Sony logo is displayed outside the company's headquarters in Tokyo, Japan February 16, 2023. REUTERS/Issei Kato/File Photo
TOKYO (Reuters) -Sony's CEO said on Thursday the spin-off of the group's financial services arm will give that business its own fundraising capabilities.
"It is significant that, through the spin-off, Sony (Financial Group) will secure its own fundraising capabilities while continuing to use the Sony brand and collaborate with Sony Group," Sony CEO Hiroki Totoki said at an investor day.
Sony plans to distribute just over 80% of its shares to Sony Financial Group, which includes banking and insurance, to shareholders through dividends in kind.
It is the first partial spin-off by a company in Japan with a direct listing - the first in Japan in more than two decades - set for September 29.
The business plans to repurchase shares totaling some 100 billion yen through to March 2027.
Its origins date back to the late 1970s, when Sony co-founder Akio Morita moved to set up a life insurance business selling to consumers.
For the financial services business, investment in its IT systems and strategic investments such as M&A will be necessary in the medium-to-long term, Totoki said.
In more recent years Sony sold off struggling hardware operations and focused on entertainment such as the PlayStation games business.
More than 60% of the conglomerate's profit came from its entertainment businesses last year.
(Reporting by Sam Nussey; Editing by Shri Navaratnam and Kate Mayberry)
