Pioneer is still awaiting the financial backing that could rescue the company from its financial woes.
Although a deal was to close in October with Baring Private Equity Asia, Pioneer issued a statement saying that talks are still ongoing.
Additionally, Pioneer just reported steep losses on slightly lower sales.
Pioneer had announced in September it would receive about $540 million from Baring Private Equity Asia, just in time to help pay back hefty loans coming due. But negotiations on the deal are now dragging on.
“November has become a make-or-break month for the talks,” said The Nikkei Asian Review Tuesday, adding, “A source close to Baring said the firm’s position has not changed, only that discussions on the final terms have dragged out.” But it quoted an unnamed senior official at Pioneer saying that the outcome of the Baring deal is still uncertain.
Pioneer admitted in September that it was having trouble remaining a “going concern,” which means it was uncertain of its ability to fulfill its financial obligations. The company had just lost $60 million in the quarter ending in June and a loan was reportedly coming due for about $120 million at the end of September.
The hope remains that Baring will still come to the rescue.
The Nikkei Asian Review reports that while Pioneer’s car navigation sales are struggling, its mapping data remains an important asset.
Pioneer has a subsidiary called Increment P, which handles databases that support very precise digital maps (the type necessary for autonomous cars). Increment P could be worth $350 million, and it’s the reason for Baring’s interest in Pioneer, said the Nikkei Asian Review.
In fact Google, whose maps have been a major factor in the devaluing of Pioneer’s car navigation business, had once sought to partner with Increment P in the mapping space, said the Nikkei Asian Review.
It said, under a best case scenario, with the backing of Baring, Pioneer can partner with a manufacturer to give it an advantage in the emerging autonomous car market. But it said, “The worst-case scenario, however, is one where Baring recoups its investment by selling off Increment, leaving Pioneer completely hollowed out.”
See the full Nikkei Asian Review story here.