Consumer electronics icon Pioneer has agreed to be acquired by a Hong Kong private equity firm for $904 million.
Pending a shareholder vote on Jan. 25, Pioneer would become a wholly owned subsidiary of Baring Private Equity Asia, which describes itself as one of the largest independent equity firms on the continent.
According to the Nikkei Asian Review, the plan calls for Pioneer to cut its workforce by about 15 percent, or about 2,500 employees, and for Baring to replace most of Pioneer’s board, including 10-year chairman Susumu Kotani, with its own officers. President Koichi Moriya would retain his post, albeit without a salary until the company returns to a growth track.
The sale reflects softened demand for aftermarket automotive tech, a core Pioneer category, as smartphone apps and advanced OEM equipment supplant navigation and A/V installs.
Pioneer has projected an operating loss of 5 billion yen for its current fiscal year ending March 2019, due largely to a 5.5 billion yen loss in its core 12-volt business, the Nikkei Asian Review reported.
The company was founded in 1938 by Nozomu Matsumoto, who crafted audio speakers in his garage, and would go on to introduce the laser disc, car CD player, GPS car navigation, the DVD video player, and HD plasma displays, among other consumer tech innovations.