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Onkyo to absorb Pioneer’s AV equipment business

JIJI

Pioneer Corp. and Onkyo Corp. have agreed to integrate Pioneer’s home audio and video equipment subsidiary with Onkyo next spring, informed sources said Friday.

While Onkyo will acquire the unit, Pioneer Home Electronics Corp., Pioneer will take an equity stake of some 15 percent in Onkyo and become its third-largest shareholder.

The Pioneer and Onkyo brands will be maintained and the companies are expected to set the details of the integration by the end of October, the sources said. The integration is designed to beef up the competitiveness of the AV equipment business by raising production and logistics efficiency, they said.

Pioneer plans to focus its management resources on its mainstay in-vehicle equipment business, including car stereo and car navigation systems, by spinning off the sluggish home-use AV operations.

In June, Pioneer said it would sell a majority stake in PHE, a wholly-owned unit based in Kawasaki, to a Hong Kong-based investment fund and Onkyo. But the Hong Kong fund decided to withdraw from the deal due to disagreements over details.

PHE generated about ¥40 billion in annual sales, accounting for some 10 percent of Pioneer’s group sales.