Sony takes out ¥80 billion loan as PS3 production ramps up

[wraggster]

Sony Corp. has taken out an 80 billion Yen (545 million Euro) three-year floating-rate bank loan - marking the first time the company has borrowed funds in ten years.

According to Bloomberg.com, more than 20 Japanese lenders will contribute to the loan, which will be used to "diversify funding sources."

The report suggests that Sony has "tapped the country's expanding syndicated loan market as it offered a cheaper source of cash at a time when investors in corporate debt are demanding higher yields before an expected rise in Japanese interest rates this year."

Sony spokesperson Shinichi Tobe told Bloomberg that the loan offers more flexibility than bonds, and that the company had ended up borrowing more funds than initially planned.

Fellow spokesperson Koji Kurata added that the funds will be used "for general purposes", according to Bloomberg. Sony intends to invest 460 billion Yen (3.13 billion Euro) in semi-conductor manufacturing and 100 billion Yen (68 million Euro) in an initiative to develop liquid-crystal displays with Samsung.

Sony is also facing costs associated with the manufacture of the PlayStation 3 and the launch of the new Blu-Ray disc format - both of which are due to roll out this year. Last year the company embarked on a three-year cost-cutting exercise that will see the loss of 10,000 jobs. ...

[acn010]

holy $#@!..........
thats a lot of money O.o'

[LAMPRO]

is their liquid cash more than 5 times their debt? what a move..

[Accordion]

i smell....

bankruptcy

[SSaxdude]

I think they're going a bit too far.

[Napalm-Death]

I don't want to think this, but it seems like the end is near..

[borgamix123]

i am portuguese and if the new ps3 site is correct with this money they will build 1092184 ps3s if they have the 20gb hard drive

[gamer121]

i think i finally get sony's plan...

see all this money sony is spending and the integration of new technology(such as Blue Ray)

there plan is to skip the next generation...so when there is a Xbox 3 they will still have the PS3 going as there main money maker

[stotheamuel]

its not too much.. its ony 1 million ps3s :-X

or 12 million games... but it does make me a bit uneasy... first time in 10 years

[BrooksyX]

basically the ps3 is going to make or break sony.

So i sure hope sony has their own halo type game up their sleeve because i personally plan on buying a xbox360 just for halo 3 and gears of war.