By Takashi Amano and Mariko Yasu on September 28, 2012 – Bloomberg Businessweek
Sony Corp. (6758), Japan’s largest consumer-electronics exporter, will invest 50 billion yen ($645 million) in Olympus Corp. (7733) as part of its strategy to move into the medical-equipment business.
The two companies will form a joint venture to make endoscopes and other medical devices, according to finance ministry filings today. Olympus is the world’s largest endoscope maker with a 70 percent market share.
Sony President Kazuo Hirai set a goal of entering into new businesses when he took over in April with the company reeling from four years of losses. The investment will help Olympus, which admitted to a 13-year accounting fraud last year, shore up its capital ratio as it recovers from the scandal that led the company to restate earnings and replace its entire board.
“There can be synergies between the two companies as Sony’s image sensors can be used in endoscopes,” said Yuji Fujimori, a Tokyo-based analyst at Barclays Plc. “Still, it may take time for their businesses to bring results as medical equipment usually needs regulatory approval before going on sale.”