The future of Pioneer Electronics Australia is today up in the air after their Japanese parent Company decided to sell their AV business to Onkyo.
The Japanese Company who has the distribution rights in
Australia to the Pure range of wireless speakers and digital radio is also set
to quit the DJ business and is openly shopping the DJ business around venture
capital investors and other AV Companies.
Over the weekend Pioneer announced that it would sell its
home A/V, phone and headphone-related businesses to Onkyo, and in turn take a
stake in Onkyo of about 15 percent.
Onkyo will acquire all outstanding shares of Pioneer Home
Electronics, a wholly owned subsidiary of Pioneer, and the business will be
integrated into Onkyo’s operations.
Initially the two Companies were set to merge however a
decision by Baring Private Equity Asia to not take an equity position in the
merged entity resulted in the sale of the struggling Pioneer business to Onkyo
who are currently shopping for a new distributor in Australia.
Insiders have told ChannelNews that this “could be the
end of Pioneer Electronics Australia” with the combined operations moving
to a distribution model Vs a subsidiary operation.
Pioneer Electronics Australia executives were not available
to comment.
Pioneer and Onkyo are expect to execute a definitive
agreement for the integration by the end of October, with the integration
effective in March 2015.
A statement issued by Pioneer claims that the deal does not
include Pioneer’s DJ business and that the Company is still looking for a buyer
of their DJ business which is profitable.
Then Chris Knott the former General Manager of Sales quit to take a role at with a major European appliance Company.
Last financial year Pioneer Electronics reported a 6.9% increase in sales to $65,293,262 this was up from $61M in the prior year. Marketing expenses increased from $1.9M to $2.1M due to part to retailers demanding investment for new instore merchandising and marketing activities said a Pioneer source.
