Tue, Mar 03, 2009 - Page 11 News List

Sony shares gain on expectations of swift reorganization

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Shares of Sony Corp rose to the highest level in about two weeks in Tokyo trading on expectations of speedier reorganization after CEO Howard Stringer took control of the company’s main electronics business.

Sony, the world’s No. 2 consumer electronics maker, gained 1.4 percent to ¥1,691 (US$17.4) as of the 11am break on the Tokyo Stock Exchange, while the Nikkei 225 Stock Average fell 3.2 percent. It was the stock’s highest level since Feb. 16.

Stringer will take over as president from Ryoji Chubachi April 1, while keeping his current roles, Tokyo-based Sony said on Friday after Japanese share markets closed.

The reassignment of Chubachi, who also headed the electronics division, will allow quicker decision-making at the producer of Bravia TV sets to help turn the TV business profitable, analysts said.

“The management change gives the impression that the company now places higher priority on faster decision making,” Kota Ezawa, an analyst with Nikko Citi Holdings Inc in Tokyo, wrote in a report yesterday.

Ezawa raised his investment rating on Sony to “buy” from “hold” and increased the share-price estimate to ¥2,100.

“Sony had a problem with its speed of making decisions, as represented by the long-standing losses at its TV business,” Nobuo Kurahashi, an analyst at Mizuho Investors Securities Co in Tokyo who rates the company “neutral,” said by telephone.

The management change “will allow the company to make faster decisions at a time of unprecedented economic crisis,” Kurahashi said.

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