Kawasaki City, Japan – Pioneer Corp. has reached a basic agreement to sell off the majority of its home electronics business to a Hong Kong private-equity firm and to Onkyo, the company announced.
Terms of the agreement were not disclosed. Pioneer will remain in the aftermarket and OEM car electronics businesses.
Baring Private Equity Asia will own a 51 percent stake in the business. Onkyo and Pioneer will own still-to-be determined percentages of the remaining stake, Pioneer said.
Pioneer and Onkyo “will make an effort to increase competitiveness by capitalizing on the resources of the two companies, such as strong brand power and superior technologies,” Pioneer said. In addition, Pioneer Home Electronics will use Baring capital to maximize synergies, including business expansion.”
Baring “specializes in companies requiring capital for expansion, recapitalization or acquisitions,” Pioneer noted.
Pioneer and Onkyo will also “commence discussions with an eye to integrating a part of home A/V business operations between Pioneer and Onkyo,” Pioneer noted. The Onkyo and Pioneer home electronics brands, however, will maintain their separate brand names.
Baring Private Equity Asia “is one of the largest and most established independent private-equity firms in Asia with total committed capital of over $5 billion,” Pioneer said.
Under the basic agreement, Pioneer will sell the majority of its wholly owned subsidiary, Pioneer Home Electronics Corp., which was formed in July 2013 for planning, manufacturing, sales and marketing of home A/V products.
Pioneer’s A/V business includes audio components, soundbars, HTiBs, Blu-ray players, networked tabletop speakers, and other home and portable audio products.
In fiscal 2013, Pioneer’s A/V segment generated sales of 108 billion yen, or about 20 percent of the company’s total sales.
