Pioneer Corporation and KKR today announced the signing of a share purchase agreement under which Pioneer’s business division that engages in the development, manufacturing and sale of DJ equipment will be spun off into a new company, Pioneer DJ, which will be jointly owned by Pioneer and KKR.
Based on this agreement, KKR will acquire all of the outstanding shares of Pioneer DJ via holding company PDJ Holdings Co., Ltd. (“PDJHD”) for approximately JPY59 billion (approximately US$551 million at the exchange rate of US$1=JPY107). Pioneer will then acquire newly issued shares in PDJHD with the result that PDJHD will be owned 85.05% by KKR and 14.95% by Pioneer.
Pioneer’s DJ equipment business develops, manufactures, and sells equipment for DJs, including DJ players, mixers, controllers, headphones, and speakers. It is a leader in the DJ equipment market with strong brand image, reputation for technological differentiation, and high profitability.
Pioneer and KKR will jointly leverage their respective business resources, brand power, and technological capability, as well as global-technology and media-industry investment experience, and networks for the further growth of Pioneer DJ.
Susumu Kotani, Representative Director, President and CEO of Pioneer, said, “As we accelerate our efforts to concentrate management resources on our car electronics business, Pioneer has been seeking the optimal partner to further the globalization of our DJ equipment business and expand the brand. We are pleased to have reached an agreement with KKR on the purchase of Pioneer DJ. KKR has a wealth of experience in the technology and media industry globally, and we are confident it has the expertise to drive Pioneer DJ forward. Pioneer will retain 14.95% of the voting rights in Pioneer DJ and we will maintain a framework for cooperation to ensure the future growth of the company.”
Hirofumi Hirano, Member of KKR and CEO of KKR Japan, said, “Pioneer has built a leading global DJ equipment business based on its powerful brands and excellence in matching product development to market requirements. KKR will work together with Pioneer DJ’s innovative management team and employees, and our investment partner Pioneer, to support further long-term growth of the business.”
Yoshiaki Ide, Executive Officer and Division Chief Officer of Pioneer’s Pro. Sound & Visual Business Division, said, “KKR’s global investment activities support the growth of businesses in a range of industries, including those in the technology and media sectors. As such, we believe this partnership will enable the further expansion of our own business. With KKR’s support, Pioneer DJ aims to add further customer value and exceed expectations with accelerated product development and enhanced service. In addition, Pioneer, as an important shareholder, will provide ongoing support.”
Subject to approval by the relevant authorities and other customary closing conditions, the above agreements are expected to be completed by March 2015.