Global asset management firm Blackstone Inc. is set to acquire an 80% stake in Sony Payment Services Inc., a payment service provider under Sony Group Corp., for approximately $280 million, according to a person familiar with the matter. The deal, which is expected to be announced soon, marks Blackstone's entry into the financial technology space in Japan. Sony Bank, a subsidiary of Sony Group, will retain a minority stake of 20% in the payment business. The total valuation of Sony Payment Services stands at around ¥50 billion ($350 million).
Sony Group, known worldwide for its electronics and entertainment offerings, also operates a robust financial services division that includes Sony Bank and its subsidiary Sony Payment. By divesting a majority stake in Sony Payment Services to Blackstone, the company is following a trend among Japanese corporations that are increasingly open to selling non-core business units to private equity investors in order to boost the value of their operations. In fact, just last month, Panasonic Holdings Corp. announced plans to sell a portion of its automotive systems unit to an affiliate of Apollo Global Management Inc.
Sony Payment Services specializes in offering payment processing services to business clients, similar to Square Inc., the well-known payment processing provider. Despite Japan being a technologically advanced nation, a significant portion of payments, close to two-thirds, are still made using cash. This implies considerable growth potential for electronic payments in the country. Given this dynamic, Blackstone's investment in Sony Payment Services positions the firm to tap into the expanding digital payments market in Japan.
For Blackstone, this deal represents their first private equity transaction in Japan in two years. As of now, the firm's existing private equity holdings in Japan are primarily in the healthcare sector, including Ayumi Pharmaceutical Corp. and Alinamin Pharmaceutical Co. By venturing into the financial technology space in Japan through its investment in Sony Payment Services, Blackstone is diversifying its portfolio and capitalizing on the growing demand for digital payment solutions.
Overall, Blackstone's acquisition of an 80% stake in Sony Payment Services Inc. underscores the company's strategic move to enter the financial technology space in Japan. With the potential for increased adoption of electronic payments in the country, Blackstone aims to leverage this opportunity by partnering with Sony Group and driving the growth and innovation of its payment processing services.