VOXX International announced it plans to partner up with Sharp Corporation to buy the home AV business of Onkyo.
VOXX said it signed a letter of intent for the acquisition of the Home Audio/Video business of Onkyo Home Entertainment Corporation, and that VOXX and Sharp have been granted exclusive rights to the deal while discussions remain underway. It hopes to reach a definitive agreement for the purchase on May 20.
If an agreement is reached, it will be presented to Onkyo shareholders for approval on June 25.
In July 2020, VOXX, through its newly formed subsidiary called 11 Trading Company, became the exclusive distributor in the Americas of the Onkyo, Pioneer, Pioneer Elite, and Integra brands. (This does NOT include Pioneer car audio now owned by Baring Private Equity Asia).
Prior to that, VOXX and Onkyo worked together when Onkyo became the distributor of Klipsch premium audio products (owned by VOXX) in Japan in 2019.
For many years, Sharp Corporation has manufactured products for Onkyo at its Malaysian factory as part of a joint venture.
Pat Lavelle, President and CEO of VOXX International said, “For the past two years, we’ve worked well with the Onkyo team, expanding our relationship, and most important, serving the needs of our customers. It is our hope that we can reach an agreement shortly as they have strong brands, and through our Premium Audio Group, led by the Klipsch management team, we have widespread distribution and a global infrastructure to support our growth.”
VOXX said all three participants, VOXX, Onkyo and Sharp have a strong working relationship.
Nikkei Asia reported this week that Onkyo Home Entertainment is in near financial collapse and it faces de-listing from the Tokyo Stock Exchange. The sale of its core audio business to VOXX and Sharp is an attempt to maintain “business continuity,” said the publication.
Onkyo’s audio business accounts for 53 percent of its sales, Nikkei Asia said.
Onkyo was founded in 1946 and was at one time a household name in speakers, turntables and stereo receivers. In 2019 it attempted to sell its business to Sound United.
Onkyo reported a negative net worth of 3.3 billion yen in the year ended March 2020, said Nikkei Asia.