Published on November 14th, 2017 | by The GC Team0
Hisense formally purchases Toshiba TV business
Hisense Electric Co. Ltd, a publicly listed subsidiary of Chinese electronics manufacturer Hisense Group, has struck an agreement with Toshiba Corporation to buy 95% of the Japanese company’s wholly-owned TV subsidiary, Toshiba Visual Solutions Corporation (“TVS”).
Both companies announced the deal today (Tuesday November 14th), confirming its value at 12.9 billion Yen (£85.9 million), and saying it is expected to be completed, subject to regulatory approval and other steps, “by or after February 2018.”
Hisense will own 95% of TVS, with Toshiba Corp retaining 5%. The purchase means Hisense will obtain the TV businesses including production, R&D and sales functions. TVS will acquire a worldwide license to use the Toshiba brand in connection with its visual solutions products and services for a period of 40 years, including in connection with TVS’s existing business partners in Europe, SE Asia and elsewhere.
For Toshiba, a brand with some 140 years of history that was a leader in the display technology market and ranked highly on the Global Technology Brand List, the sale marks a further step in its attempts to regroup following its recent financial difficulties.
For Hisense, it appears to be a further move to develop its brand presence in consumer electronics. TVS primarily operates Toshiba TV and various ancillary products, including commercial display and advertisement display products. TVS has two factories in Japan, a considerable number of R&D employees and a significant IP portfolio related to TV business – including patents related to TV image quality and acoustics.
Mr. Liu Hongxin, the CEO of Hisense Group, said Hisense will optimize TVS’s resources on R&D, supply chain and global sales channels by cooperating with and supporting each other’s display technology; providing competitive content operation services for smart TVs for the global market and accomplishing continued and fast growth in the Japanese market.
Toshiba TV sales ranked No.3 in the Japanese market in 2016 (HIS data). At present, Hisense TV’s market share in the Japanese Market is the highest among all non-Japanese brands. Together, Toshiba and Hisense have 20% of the TV market in Japan. Hisense’s colour TV business in 2016 ranked third in the world (IHS). It has been No.1 in China for 13 consecutive years and recently announced sponsorship of the 2018 FIFA World Cup.
“With the benefit of this acquisition, Hisense will develop and enlarge its international strategy TV business in R&D, branding and marketing by operating under multiple brands. The cooperation between Hisense and Toshiba will help drive changes in the TV business.”