JOINT VENTURE

JOINT VENTURE:

A joint venture is a business agreement in which the parties agree to develop, for a finite time, a new entity and new assets by contributing equity. They exercise control over the enterprise and consequently share revenues, expenses and assets. There are other types of companies such as Joint Venture limited by guarantee, joint ventures limited by guarantee with partners holding shares.

Sony completes takeover of Sony Ericsson joint venture

Sony has completed the buyout of Ericsson's 50 per cent stake in the firm's joint mobile phone venture that struggled to compete against the likes of Apple, Motorola and Samsung.

The Japanese manufacturer paid €1.05bn to buyout its partner and aims to focus its attention on the mobile market.

In a short statement, Sony confirmed details about the rebranding and how it plans to ship interconnected devices to attract customers.

"Sony will rename Sony Ericsson 'Sony Mobile Communications', and further integrate the mobile phone business as a vital element of its electronics business, with the aim of accelerating convergence between Sony's line up of network enabled consumer electronics products, including smartphones, tablets, TVs and PCs," the firm said.

The takeover was announced on 27 October 2011, and the move was seen as a positive step by analysts.

Former Sony chief executive, Sir Howard Stringer said that the reasoning behind the buyout was to firm to align future products into one brand, much like Apple and Samsung.

Sony is set to release its flagship Xperia S smartphone during the first week of March and it looks increasingly likely that this will be the first device to carry the rebrand.

It remains to be seen whether the buyout will help Sony make headway in the mobile market.

The Japanese firm had a disastrous end to 2011, posting a whopping $2billion loss for the fourth quarter. The firm also tried to enter the tablet market, with its Tablet P and Tablet S device, but failed to challenge devices such as the iPad 2 and Samsung Galaxy Tab.