Sony is selling off its laptop business, currently operating under the Vaio brand, to an investment fund in Japan. Further, the company will be spinning off its TV business into a separate unit. The restructuring comes in the heels of dismal earnings report, and will result in roughly 5,000 job cuts (1,500 in Japan, 3,500 overseas) by the end of FY14.     

Japan Industrial Partners (JIP) is buying Sony’s PC business, currently operated under the VAIO brand. The terms of the transaction, expected to close around July this year, are still being worked out says Sony. JIP will establish a new company based at the Nagano Technology Site, the hub of Sony’s current PC operations, and hire roughly 250 to 300 people Sony employees.

Here is an excerpt from the official statement released by Sony:

Following a comprehensive analysis of factors, including the drastic changes in the global PC industry, Sony’s overall business portfolio and strategy, the need for continued support of Sony’s valued VAIO customers, and future employment opportunities for personnel involved in the VAIO business, the Company has determined that concentrating its mobile product lineup on smartphones and tablets and transferring its PC business to a new company established by JIP is the optimal solution. Sony and JIP will now proceed with due diligence and negotiate detailed terms and conditions of the business transfer, targeting the conclusion of a definitive agreement by the end of March 2014. Following reevaluation of the product lineup, the new company is expected initially to concentrate on sales of consumer and corporate PCs in the Japanese market and seek to optimize its sales channels and scale of operations, while evaluating possible further geographic expansion.

As a part of the business transfer to JIP, Sony will cease planning, design and development of PC products. Manufacturing and sales will also be discontinued after the Spring 2014 lineup to be launched globally. Even after Sony withdraws from the PC market, Sony customers will continue to receive aftercare customer services. Approximately 250 to 300 Sony Corporation and Sony EMCS Corporation employees involved in PC operations, including planning, design, development, manufacturing and sales, are expected to be hired by the new company established by JIP. Sony will also explore opportunities for other employees to be transferred to other businesses within the Sony Group. For employees of Sony Corporation and Sony EMCS Corporation that are not hired by the new company or transferred within the Sony Group, Sony plans to also offer an early retirement support program to assist their reemployment outside of the Sony Group.

Sony’s Vaio business employed roughly 1,000 people. The business was established in 1996.

[Image courtesy: Sony]