Sony Computer to buy major stake in video-game maker

Sony Corp's video-game unit will take a 19 percent stake in Square Co, a Tokyo video-game maker, for ?14.9 billion (US$124 million), both sides said yesterday.

Sony Computer Entertainment, which makes the PlayStation2 consoles, will buy 11.2 million new shares in Square at ?1,330 (US$11) per share, an 18 percent discount on the issue's Tuesday closing price of ?1,616 (US$13.50).

Sony said investing in Square will allow both companies to work together to develop online games.

Square makes the ``Final Fantasy'' series, which has sold 35 million copies around the world and is now a movie. Square has said income from the movie is falling short of the target. Square invested ?13.9 billion (US$116 million) in the movie.

Meanwhile, Japan's Finance Ministry downgraded its economic assessment of the state of the nation's economy for the third time within a year. The ministry cited slack consumer spending and corporate investment.

"In general, conditions are more severe" the ministry said in an economic assessment compiled from reports by its 11 regional finance bureau chiefs.