Sound United Terminates Onkyo Acquisition

Talks between Sound United and Onkyo Consumer Audio have broken down resulting in both companies backing out of an acquisition agreement.

In my earlier post in mid-May, Sound United LLC had announced the signing of a term-sheet agreement to acquire Onkyo Corporation’s consumer audio division that includes the Onkyo, Pioneer, Pioneer Elite, and Integra brands. An acquisition that looked in line with the continued expansion plans of Sound United and one that had previously been agreed by Viper Holdings, the financial holding company for Sound United LLC.

This transaction as with many others was subject to due diligence, financing and other fiscal and business agreements. The agreement of transfer and acquisition is due to expire in November 2019 and it had become apparent that the Transfer could not be completed by this date.  All parties have therefore agreed to terminate the agreement.

Despite this termination both companies are still open to further discussions at a later date should business or market conditions change.

So its back to business as usual for Onkyo who will continue to look for other potential alliances and additional financing in order to continue to develop and support their home hi-fi market through its various brands, just as Sound United will continue to pursue its ongoing growth though its current stable of Denon, Polk Audio, Marantz, Definitive Technology, HEOS, Classé, and Boston Acoustics products.

My 2 cents: This is quite a surprise for all business watchers as there was no indiction on the streets that this merger wasn’t going to happen. So its back to business as usual now for Onkyo and Pioneer. No doubt the reasons for the termination will emerge as time passes.

See my original posts on Sound United here and here.

For more information about Sound United click here.