Tokyo – Pioneer reached an agreement to sell the majority of its DJ business after reaching an agreement last week to sell the majority of its home-A/V business to Onkyo.
With the spinoffs, Pioneer will “accelerate the concentration of management resources on the car electronics business,” the company said. “Our goal for the home-A/V and DJ equipment businesses is to work with outside partners to expand the businesses and increase brand value.”
The company said its “financial strategy is to reduce debt through the partial transfer of businesses and sale of idle assets as part of our business portfolio realignment, while at the same time rebuilding and streamlining our management structure to generate continuous profits, to rebuild our financial base to allow for necessary investment for the future.”
Last week, Pioneer announced a deal to sell its home A/V, phone and headphone-related businesses to Onkyo and in turn take a stake in Onkyo of about 15 percent. A definitive agreement is expected in October with the integration effective in March 2015.
Under the latest deal, Pioneer will sell 85 percent of its DJ equipment business to investment company KKR to “jointly leverage their respective business resources, brand power and technological capability, as well as global‐technology and media‐industry investment experience, and networks for the further growth of Pioneer DJ,” the companies said in a joint statement.
Yoshiaki Ide, division chief office of Pioneer’s pro sound and visual business division, said the deal would “add further customer value and exceed expectations with accelerated product development and enhanced service.” KKR’s “partnership will enable the further expansion of our own business,” he added.
Under the terms of the deal, KKR will acquire all of the outstanding shares of Pioneer DJ for around JPY59 billion (about $551 million at the exchange rate of US$1=JPY107). Pioneer will then acquire newly issued shares in in the company to own 15 percent.
Pioneer’s DJ equipment business develops, manufactures and sells DJ players, mixers, controllers, headphones and speakers.
The deal is expected to close by March 2015.