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Sony Denies Report Of Chip Sale To Toshiba

Electronics company says it is looking at ways to improve its chip operations but hasn't reached a decision.

TOKYO (AP) — Sony is looking at ways to improve its chip operations but has reached no decision, the company said Tuesday, denying Japanese media reports that it has a deal to sell the business to Toshiba.
Toshiba Corp. spokesman Keisuke Omori said nothing has been decided on such a deal.
Japan's top business daily, The Nikkei, reported Saturday that Sony Corp. has decided to sell its advanced computer chips production operations to Toshiba Corp., a Japanese electronics maker with which Sony and IBM Corp. collaborate to make the ''cell'' microprocessor. The technology is used in Sony's PlayStation 3 video game console and other advanced gadgets.
The speculation comes amid intensifying competition among the world's computer chip makers, including South Korea's Samsung Electronics Co. and Intel Corp. of the U.S.
Prices have been dropping not only on lower-end chips but all gadgets, making it harder for manufacturers to maintain profits.
Sony shares fell 2.2 percent amid market expectations that the company will have to shoulder losses for the chips sale to Toshiba. Toshiba shares dipped 0.6 percent.
Sony has been saying for months it's exploring ways to streamline its chip business.
''But nothing concrete has been decided,'' Sony spokesman Tomio Takizawa said.
Toshiba has been working on strengthening its large-scale integrated, or LSI, chips business. LSI chips are widely used in cell phones, digital players and other gadgets, and are considered more profitable than less sophisticated chips.
In the weekend report, The Nikkei said Sony will sell the operations to Toshiba, but they will establish a joint venture that will use existing manufacturing lines to make advanced chips.
Toshiba will take a majority stake in that venture, and Sony will be the principal buyer of the chips and will have a say in management, the report said. Sony's game unit, Sony Computer Entertainment Inc., may also take a stake, it said.
IBM declined to comment.
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