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January 28, 2003



Agreement to Make CIS Corporation a Wholly-Owned Subsidiary of Sony Corporation
Subsequent Merger with Existing Sony's Information System Subsidiary Planned

Sony Corporation
Nobuyuki Idei
Representative Director
(Code No.: 6758 Tokyo, Osaka, Nagoya, Fukuoka, and Sapporo Stock Exchanges)

CIS Corporation
Osamu Todaka
Representative Director (Code No.: 4758 JASDAQ)


   At their respective Board of Directors' Meetings held today, Sony Corporation ("Sony") and CIS Corporation ("CIS") have approved a decision to make CIS a wholly-owned subsidiary of Sony through a stock for stock exchange agreement. After obtaining approval at the CIS Shareholders' Meeting scheduled for March 27, 2003, it is planned to implement the stock for stock exchange on May 1, 2003. The intention is to then merge CIS with Sony's existing information system subsidiary, Sony Information System Solutions Inc. ("SISS"), to create a new company. The new company is targeted to begin operations in July 2003.

   Sony is currently accelerating its drive to construct a global information system platform through a supply chain that applies advanced IT and the reform of processes for production, sales and accounting. SISS has been at the center of these efforts with the construction and maintenance of information systems and the provision of infrastructure services. However, as the need for the creation of a global information system platform has grown, key processes (information system planning, design as well as project management) require strengthening. The plan for CIS to become a wholly-owned subsidiary of Sony and the subsequent merger with SISS is intended to focus resources and enhance productivity in these areas. This will allow the creation of an advanced system platform for the entire Sony group as well as cutting information system costs groupwide. The idea is to promote a "System on Demand" service model which integrates all elements from network infrastructure to applications by applying sophisticated broadband technology.

   CIS was founded in 1988 and has gained a reputation as a "Global IT Evangelist" introducing advanced IT methodology as a part of management innovation in Japan. The company rapidly built up expertise in system consulting and integration and made an OTC listing in June 2000. Since July 2001, when it formed a joint company with Sony for management and information consulting (GENCIS Consulting Inc.) CIS has developed partnerships with Sony and SISS. With the new agreement, CIS will now become a full member of the Sony Group and will be able to participate in the most advanced ongoing projects. This will give it an opportunity to maximize the skills and experience it has acquired and to develop a new level of high-quality consulting services.

   Sony and CIS will then work toward the merger of SISS and CIS. The new company will combine skills and resources to create an integrated global information system platform for the entire Sony Group and to generate further efficiencies. The new company will also expand its existing IT consulting business.

   CIS President Osamu Todaka is scheduled to become Representative Director and President of the new company. SISS President Kazuro Sato is scheduled to become Representative Director and Vice President of the new company.

1. Conditions of stock for stock exchange, etc.
(1) Stock for stock exchange schedule
January 28, 2003(Tuesday) Board meetings to approve stock for stock exchange agreement
January 28, 2003(Tuesday) Conclusion of stock for stock exchange agreement
March 27, 2003(Thursday) Shareholders meeting to approve stock for stock exchange agreement (CIS)
April 30, 2003(Wednesday) Last day of share certificate submission period (CIS)
May 1, 2003(Thursday) Effective date of stock for stock exchange
*Pursuant to the provisions of Clause 1 of Article 358 of the Commercial Code of Japan, Sony shall perform the stock for stock exchange with CIS without approval of the stock for stock exchange agreement by its shareholders.


(2) Stock for stock exchange ratio
   Sony retained Morgan Stanley Japan Limited, and CIS retained Nomura Securities Co., Ltd. for advice on the analysis of the stock for stock exchange ratio and other relevant matters. Based on such advice and other considerations, Sony and CIS negotiated and came to the following agreement regarding the stock for stock exchange ratio.
    Note that if there are any material changes in any of the various conditions upon which the stock for stock exchange ratio shown below was determined, Sony and CIS may decide to change the said ratio.
    The CIS board of directors today resolved to cancel 5,000 shares of CIS treasury stock before the stock for stock exchange takes place. The stock for stock exchange ratio shown below has been calculated based on the number of CIS shares that will remain outstanding after the cancellation of treasury stock.


Sony
CIS
Stock for stock exchange ratio
1
8.74


(Notes) 1.
Morgan Stanley Japan Limited performed Stock Price Performance Analysis to analyze the fair value of Sony, and Stock Price Performance Analysis, Comparable Company Analysis and Discounted Cash Flow Analysis (DCF) to analyze the fair value of CIS. The results of all such analysis and relevant factors, as well as the synergies expected from CIS as a wholly-owned subsidiary of Sony and its subsequent merger with SISS, were relevant considerations in the analysis of the exchange ratio.
2.
Nomura Securities Co., Ltd. assessed the value of shares of Sony by using the Market Price Analysis, and of shares of CIS by using the Market Price Analysis, the Comparable Trading Multiples Analysis, the Net Adjusted Book Value Analysis and the Discounted Cash Flow Analysis. Nomura Securities considered the results of the analyses as a whole and derived an exchange ratio.
3.
Number of shares to be issued upon stock for stock exchange: 1,088,304 shares of common stock of Sony (For each share of CIS common stock, Sony shall issue 8.74shares of its common stock.)


2. Summary of Parties
(1) Trade name Sony Corporation CIS Corporation
(2) Field of business Manufacture and sale of electronic and electrical machines and equipment Development, introduction and consultation of information systems
(3) Date of incorporation May 7, 1946 November 5, 1988
(4) Location of head office 7-35, Kitashinagawa 6-chome,Shinagawa-ku, Tokyo 7-7, Higashi-Shimbashi 2-chome,Minato-ku, Tokyo
(5) Representative Nobuyuki Idei, Representative Director Osamu Todaka,Representative Director
(6) Share capital ¥476,224 million ¥3,303 million
(7) Total number of shares issued and outstanding 922,918,991 shares 129,520 shares
(8) Shareholders' equity ¥1,886,389 million ¥6,175 million
(9) Total assets ¥3,615,038 million ¥6,744 million
(10) Date of settlement March 31 December 31
(11) Number of employees 16,836 167
(12) Major customers Affiliated manufacturing and salescompanies inside and outside Japan Manufacturing, financing, service, and IT companies in Japan
(13) Major shareholders and shareholding ratios 1 Moxley & Co. 6.1%
2 Japan Trustee Services Bank,Ltd. (Trust Account) 4.4%
3 The Master Trust Bank ofJapan, Ltd. (Trust Account) 3.3%
4 The Chase Manhattan Bank,N. A. London 2.9%
5 State Street Bank and TrustCompany 2.8%
1 JBL Corporation 23.9%
2 Osamu Todaka 22.9%
3 Microsoft Corporation 20.8%
4 The Master Trust Bank ofJapan, Ltd. (Trust Account) 4.4%
5 CIS Corporation 3.9%
(14) Main banks Sumitomo Mitsui Banking CorporationThe Bank of Tokyo-Mitsubishi, Ltd.and others The Bank of Tokyo-Mitsubishi, Ltd.Mizuho Bank, Ltd.and others

(Note)
The above date for Sony and CIS are as of September 30, 2002 and June 30, 2002 respectively.


(15) Business results for the three most recent years (unit: millions of yen)

Sony Corporation CIS Corporation
Fiscal year ended on 2000/3/31 2001/3/31 2002/3/31 1999/12/31 2000/12/31 2001/12/31
Net sales
2,592,962
3,007,584
2,644,195
4,031
5,068
5,393
Operating income (loss)
(2,755)
50,458
(52,994)
566
773
(659)
Ordinary income (loss)
30,237
81,502
(6,122)
564
733
(651)
Net income (loss)
30,838
45,002
29,635
251
381
(539)
Net income (loss) per share (yen)
73.09
49.18
32.22
53,890.47
30,442.98
(4,167.46)
Dividends per share (yen)
50
25
25
0
10,000
0
Shareholders' equity per share (yen)
3,956.68
2,021.33
2,024.10
240,032.78
626,765.21
57,513.68

(Notes)
1.Sony split its shares at a ratio of two shares for each share on May 19, 2000.
2.CIS split its shares at the ratio of two shares for each share on October 20, 2000, and at the ratio of ten shares for each share on August 1, 2001.

3. Circumstances after stock for stock exchange
(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 Nobuyuki Idei
Representative Director
(5) Share capital This stock for stock exchange will not effect the amount of Sony's share capital.
(6) Effect on business result This stock for stock exchange will not have a material effect on Sony's business results.