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July 22, 2005

Announcement of Merger of Subsidiary

Sony Corporation ("Sony") has decided that Sony will absorb WP Corporation by a merger effective October 1, 2005.

1.Purpose of the merger

Webpocket Corporation, a wholly-owned subsidiary of Sony, established a subsidiary company and transferred its operation on July 1, 2005. The purpose of this was to strengthen Sony's storage business to correspond to the enlarged demand for personal storage, and to improve profitability by integrating storage functions within the Sony Group. Webpocket Corporation changed its company name to WP Corporation, also effective July 1, 2005. The name, Webpocket Corporation has been adopted as the company name for the new subsidiary company.

Upon completion, Sony will directly hold WP Corporation's shareholdings of the new subsidiary company. In this manner, Sony will strive to further link and strengthen the storage business within the Sony Group.

2.Conditions of the merger

(1) Schedule of the merger

  • July 28, 2005 (Thursday)
    Conclusion of merger agreement
  • August 15, 2005 (Monday)
    Shareholders meeting to approve
    merger agreement (WP Corporation)
  • October 1, 2005 (Saturday)
    Effective date of merger
  • October 3, 2005 (Monday)
    Official registration of merger
  • *Pursuant to the provisions of Paragraph 3 of Article 413 of
    the Commercial Code of Japan, Sony shall perform the
    merger with WP Inc. without the approval of the merger
    agreement by its shareholders.

(2) Method of the merger

Sony, as an ongoing concern, shall absorb WP Corporation, which shall be subsequently dissolved.

(3) Others

Due to the fact that WP Corporation is a wholly-owned subsidiary of Sony, there shall be no issuance of new shares or cash payment upon this merger.

3.Summary of Parties

(1)Trade name Sony Corporation WP Corporation
(2)Field of business Manufacture and sale of electronic and electrical machines and equipment Information processing service by various mediums including the Internet
(3)Date of incorporation May 7, 1946 September 14, 2000
(4)Location of head office 7-35, Kitashinagawa 6-chome, Shinagawa-ku, Tokyo 12-3, Higashishinagawa 4-chome, Shinagawa-ku, Tokyo
(5)Representative Nobuyuki Idei,
Representative Corporate
Executive Officer
Tatsuya Akashi,
Representative Director
(6)Share capital ¥621,708 million ¥100 million
(7)Total number of shares issued and outstanding 1,000,283,213 shares 9,600 shares
(8)Shareholders' equity ¥2,042,798 million ¥ -1,339 million
(9)Total assets ¥3,684,545 million ¥395 million
(10)Date of settlement March 31 March 31
(11)Number of employees 15,892 0
(12)Major customers Affiliated manufacturing and sales companies in and outside Japan Sony Corporation
(13)Major shareholders and shareholding ratios 1.Moxley & Company 13.6%
2.Japan Trustee Services Bank, Ltd. (Trust Account) 4.1%
3.The Master Trust Bank of Japan, Ltd. (Trust Account) 3.8%
4.The Chase Manhattan Bank, N. A. London 3.4%
5.State Street Bank and Trust Company 505103 1.7%
Sony Corporation 100%
(14)Main banks Sumitomo Mitsui Banking Corporation
The Bank of Tokyo-Mitsubishi, Ltd. and others
Sumitomo Mitsui Banking Corporation
  • * The above data are as of March 31, 2005 except for the number of employees of WP Corporation, which is as of July 1, 2005.

(15) Business results for the three most recent years

(unit: millions of yen)
Sony Corporation WP Corporation
Fiscal year ended on 2003/3/31 2004/3/31 2005/3/31 2003/3/31 2004/3/31 2005/3/31
Net sales 2,526,264 2,814,577 2,895,413 72 46 64
Operating income (loss) (136,644) (139,709) (64,622) (350) (472) (453)
Ordinary income(loss) (29,525) (68,758) 45,755 (350) (474) (456)
Net income (loss) (4,868) (98,530) 56,656 (433) (439) (690)
Net income (loss)
per share (yen)
(5.46) (106.55) 60.81 (45,117.85) (45,684.62) (71,879.67)
Dividends per share (yen) 25.00 25.00 25.00 0 0 0
Shareholders' equity per share (yen) 1,968.62 1,856.37 2,040.32 (21,963.25) (67,647.87) (139,527.55)

4.Circumstances after the merger

  • (1)Trade name
    Sony Corporation
  • (2)Field of business
    Manufacture and sale of electronic and electrical
    machines and equipment
  • (3)Location of head office
    7-35, Kitashinagawa 6-chome, Shinagawa-ku, Tokyo
  • (4)Representative
    Ryoji Chubachi,
    Representative Corporate Executive Officer
  • (5)Share capital
    Upon this merger the amount of share capital will not change.
  • (6)Total assets
    This merger will not have a material effect on Sony's total assets.
  • (7)Date of settlement
    March 31
  • (8)Effect on business results
    This merger will not have a material effect on Sony's business results.
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