Mumbai: Dubai International Capital (DIC), an investment company owned by the ruler of the United Arab Emirates, Sheikh Mohammed bin Rashid Al Maktoum, has acquired a substantial stake in Japanese electronics giant Sony Corporation.

The stake was bought through DIC''''s $2 billion Gulf Arab Global Strategic Equities Fund.

DIC spokesman said the company made a "substantial" investment in Sony but declined to disclose details about the size of the stake. Sony also declined to disclose the size of the acquisition. However, the Dubai fund is estimated to have taken less than a 5 per cent stake, the ceiling above which the acquirer has to make a public disclosure under Japan''''s securities laws.

A three per cent stake in Sony would cost about $1.5 billion (£724million) at its current share price.

This is the first time the Dubai fund has invested in Japan and reflects a wider trend of oil-rich Gulf states trying to diversify their investments.

"Whilst the restructuring process at Sony is well advanced, the recent successful listing of Sony Financial Holdings is evidence of management''''s ongoing strategy of focusing on capital efficiency and cash generation," said Sameer al-Ansari, chairman and CEO of Dubai International Capital.

Sony, which is in the final year of a three-year turnaround plan led by its chief executive Howard Stringer, is spinning off parts of its business that it does not consider core to its future as a consumer electronics manufacturer.

Sony reported an operating profit in the last quarter against an operating loss in the same quarter the previous year, despite widening losses in its division which manufacturers its Playstation 3 console.

Sony also slashed the price of its next generation games hardware in the US to better compete with rivals Microsoft''''s Xbox 360 and Nintendo''''s Wii.

Dubai royal investment fund, meanwhile, is speeding up its acquisitions across Asia. The cash-rich Dubai International Capital has kicked off plans to shop for a whole list of Asian stocks.

The Sony investment is Dubai International Capital''''s third venture this year, following the purchase of a 3.12 per cent stake in the European Aeronautic Defence and Space Co., the parent company of Airbus, for about 608 million euros ($904 million) in July and a stake worth about $1 billion in HSBC Holdings in May.