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Sony Forecasts $1.2 Billion Gain Following M3 Stake Sale

Sony Corp. (6758) predicted a 115 billion- yen ($1.2 billion) gain following the sale of a stake in health- care data provider M3 Inc. (2413) as it sheds assets and tries to avoid a fifth straight annual loss.

The TV maker sold 6 percent of M3 to Deutsche Bank AG’s securities arm for 14.2 billion yen ($152 million), according to a statement today. Most of Sony’s gain from the deal will come from a revaluation of its remaining holdings in M3, the Tokyo- based company said yesterday.

Sony will book the gain this quarter, along with the profit from the $1.1 billion sale of its New York offices. The deals suggest Japan’s biggest consumer-electronics exporter is banking on about 180 billion yen of profit from asset sales to achieve its annual net income target of 20 billion yen, according to Hideki Yasuda, an Ace Securities Co. analyst.

“This gives the impression that the company is desperate to be in the black,” he said yesterday. “I’m surprised by the size of the loss at its core electronics business.”

The maker of Bravia TVs is heading for a ninth straight annual loss in the business amid slowing demand and competition from Samsung Electronics Co. (005930) Sony’s Xperia smartphone and tablet also are struggling to keep pace with sales of Apple Inc. devices.

M3, which provides online data for doctors, fell the most in almost two years in Tokyo trading, dropping 5.3 percent to 153,500 yen. Sony declined 1.8 percent to 1,331 yen. The company sold 95,000 shares in Tokyo-based M3.

Accounting Gain

Most of Sony’s gain from the sale will be triggered by its holdings dropping below 50 percent. That will let electronics maker treat its remaining 49.8 percent stake differently for accounting purposes.

Sony, which also yesterday unveiled the PlayStation 4 video-games console, earlier this month reported a nine-month net loss of 50.9 billion yen. It reiterated its full-year profit forecast of 20 billion yen. The target included the expected gain from the M3 deal, Sony said yesterday. Still, the prediction is being revaluated in light of the sale and other factors, it said.

Sony expects a profit of about $685 million from the sale of its U.S. headquarters to investors led by Chetrit Group, it said last month. Chief Executive Officer Kazuo Hirai has also agreed to sell a chemical unit and stakes in display-making ventures this fiscal year as he sharpens Sony’s focus on mobile devices, games and digital imaging.

The company said Feb. 7 it was looking at possible asset sales, some of which were included in its full-year forecast, after previously selling land, buildings, businesses and securities holdings.

Sony may fetch 100 billion yen selling its 25-story office building in Tokyo, Reuters reported Jan. 10, citing people with direct knowledge of the plan.

To contact the reporter on this story: Mariko Yasu in Tokyo at myasu@bloomberg.net

To contact the editor responsible for this story: Michael Tighe at mtighe4@bloomberg.net

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