Pioneer Corporation announced it will become a wholly owned subsidiary of Baring Private Equity Asia, based in Hong Kong. It will delist its shares and cut about 15 percent of its workforce, which stood at 17,000 employees earlier this year.
According to the Nikkei Asian Review, a change in Pioneer’s corporate management is also expected and all of Pioneer’s current board members, apart from President Koichi Moriya and two outside directors are to be replaced by Baring.
Baring will spend the equivalent of about $904 million on the purchase, including a $680 million investment in Pioneer and a $220 million cash offer to Pioneer shareholders.
A statement from Moriya said, “After deep discussions between both parties, we concluded that it would be best to take Pioneer private. This is because we recognized that to ensure business continuity and return Pioneer to growth in the medium- and long-term, it is vital to swiftly overhaul our organizational structure and review our business portfolio. We also recognized that, given the challenge of achieving near-term profitability, taking the company private represents the best option for Pioneer.”
He added, “My mission is to help revitalize Pioneer as quickly as possible and return the Company to a position where it can deliver products and services that delight all of our customers….[Baring Private Equity Asia] (BPEA) sees great potential in Pioneer’s innovative technology, well-established brands and people, and shares our vision for the future of our Company.”
Moriya said, “Despite the challenging situation we face, I firmly believe that this partnership with BPEA and the investment it brings will usher in a bright new future for a revitalized Pioneer.”
Hopefully the new board gets rid of the completely useless, crooked dealer reps in the US. Such a disgraceful company. I hope my old reps end up as door greeters at Walmart, although they deserve far worse.
. They said already it was smart phone gps that sunk their oem division which was where that had biggest investment . How would raising aftermarket prices have helped?
Reorganization, clean up the supply chain, less SKUs and get prices/profits up. I’m not implying just raise prices only. My time is sparse and don’t have enough time to explain the big picture. But have been in retail since 1962 and our profits continue. Numbers up 31.3% this YTD. Just Saying. Make 12V Great Again!
Nothing good ever comes from being purchased by a private equity company, how did it work out for Sears, or Toys R Us, the names can go on and on…… Maybe, this firm can scale back the 26000 single and double din head unit options Pioneer makes, to the required 3, 4 tops head unit models required?
We should all heed to these Pioneer events and let them be a sign of what not to do! Hopefully Pioneer will raise their prices. As we all know lowering prices does not equate to profit. The name Pioneer in the public space still holds a name that speaks quality. Hopefully the new regime will capitalize on that and raise their prices and for Heaven’s sake put some money in their pockets. Raising our prices is our only salvation. Hopefully the top five Pioneer, Alpine, Kenwood, JVC and Sony will just let the gutter rats in this industry drown in their lonely place one the internet. I mean let’s face it those gutters rats don’t get any display space in our showrooms. So, let’s just continue to educate the consumers about the no name crap and have faith that the specialists in the retail chain will continue to display the top five as the quality product on the market and we can all have a profitable outcome. Can I get an Amen? If any of the top five are reading this, please remember who your truest partners have been and please keep it clean on the internet. And we will shine your light. Mobile Mike “Just Saying “Let’s Make 12V Great Again!
I fully agree with your post, owning my shop for over 26 years now we are located neighboring state and near Southern California, they have massive issues with their distribution in our area. They sell the absolute worse distributors in the West. I hope they clean up these terrible distributors and concentrate on retailer direct (and if they have to, choose distributors with some ethics). Pioneer was the second line that signed me up many years ago and I would love to see them make a clean comeback. The Pioneer sales staff knows who the “gutter rats” are; ethics and morales people.
A sad result that no Japanese investment firms could see the purchase of this once mighty power-house as a viable investment risk so it’s gone to China.
Pioneer were instrumental in creating our industry but also instrumental in the “race to the bottom” and therefore their own demise.
Be interesting to see what gets churned out now as this equity firm seeks to maximise profitability and ROI in a ‘cheaper with more features please’ world jointly created (include Sony) by the very same company they’ve just purchased . I’m guessing they can’t lose either way. If the company doesn’t come back to a profitable position in a given timeframe it can always be broken up, sold off in category chunks to the highest bidder(s) and assets liquidated so they won’t lose no matter what.
Vale Pioneer.