Magazine article Gramophone

All Change in the World of Consumer Electronics: Mergers, Moves and Acquisitions: Some of the Best-Known Names in Hi-Fi and Consumer Electronics Are Finding New Ways to Ensure Their Survival in a Difficult Market Place

Magazine article Gramophone

All Change in the World of Consumer Electronics: Mergers, Moves and Acquisitions: Some of the Best-Known Names in Hi-Fi and Consumer Electronics Are Finding New Ways to Ensure Their Survival in a Difficult Market Place

Article excerpt

You never know when the hi-fi and consumer electronics industries are going to wrong-foot you: over a period of not much more than a month, one of Japan's most famous electronics brands was sold to a Taiwanese company; a famous British name announced plans to close its last remaining factory in the UK; and perhaps the world's best-known 'style' audio company called off long-running takeover talks with a Chinese investor.

That covers Sharp, Tannoy and Bang & Olufsen respectively--but then, just as I was getting my breath back, came the news that Bowers & Wilkins had been acquired by a small Silicon Valley-based start-up headed by a former Facebook executive. The announcement came out of the blue, on the eve of the world's biggest specialist hi-fi show, High End 2016, in Munich.

Without a doubt the global consumer electronics landscape is changing, and it seems even the best-known brands are in need of investment to secure their futures. Having hit its centenary back in 2012 with record debts and tumbling sales, since when things have gone from bad to worse, Sharp has recently been acquired by Taiwanese company Hon Hai, but not without further pain: during the protracted takeover talks Hon Hai, better known as contract manufacturer Foxconn, claimed to have uncovered all kinds of additional liabilities and financial stumbling blocks revealing the true nature of the perilous situation in which the Japanese company found itself.

Hon Hai, which has huge production facilities in China and employs 1.3 m people making a wide range of equipment for Apple, Sony and other companies, had long been courting Sharp. The two companies already jointly ran two LCD display screen plants--once seen as the pride of Japanese TV-making but now increasingly turned over to the manufacture of the more lucrative smaller panels for smartphones and tablets--and for a good while the balance of power in the partnership had been shifting, leading to Hon Hai's eventual acquisition of two thirds of the Japanese company.

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Tannoy, meanwhile, had found itself bought a while back by the Danish TCS Group, which in turn was swallowed up last year by the California-based Music Group, the makers of brands including Behringer and pro audio brand Turbosound. In April this year, Music Group announced plans to close the last Tannoy factory in the UK, the Coatbridge factory, with the loss of some 70 jobs. Research and development will still be carried out at the company's Manchester offices, but all production will move to Music Group's massive 280,000 square-metre facility in Zhongshan, China. …

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