Acquisition season it is. The ink isn’t yet dry on the Verizon-Yahoo deal and there is already another huge acquisition underway. Chinese electronics firm LeEco is buying American TV manufacturer Vizio for $2 billion. Yeah, if you were still thinking of LeEco as some cheap chinese phone exporter, think 2 billion times post reading this story.
The acquisition was announced during a press event this morning in Los Angeles. However, don’t expect much changes as LeEco is planning to continue operating Vizio under its own name as a wholly-owned subsidiary.
Meanwhile, Vizio — which is a pretty popular TV brand in its own right — will continue operating as usual with no major changes in its current management team which will keep working out of its offices in Southern California. The only major change will be with regards to Inscape, Vizio’s data business.
Inscape will now be spun out and operated as a privately held company. LeEco is receiving around 49 percent stakes while Vizio CEO William Wang will serve as chairman and CEO of Inscape, and retain the remaining 51 percent of shares. Vizio will continue to license Inscape’s technology for 10 years for use in its televisions.
Meanwhile, the deal is expected to conclude in the fourth quarter of this year. Speaking on the topic with an unusual frankness, Vizio founder and CEO William Wang said,
I have mixed feelings. As the owner and father of Vizio, I am very reluctant to let it go. But as the CEO and owner of the company, I know this is the right decision to make for our hardworking employees and loyal shareholders.
Wang started the company almost 14 years ago and in the decade and a half period, managed to make it into a multi billion enterprise by selling Televisions at a slightly lesser price than competitions. Vizio has built quite a name for itself in the impending years and is one of the most popular US brands thanks to it’s steady business tactics and focus on the country. The company did run into trouble once when it was discovered that it was siphoning off data associated with its customer’s viewing habits, for Inscape, however that is in the past now.
LeEco, although rather less known, is a huge brand in its own right. The company has its fingers in many pies so to speak, with interests spanning Smartphones , Android-powered bicycles, electric cars; and so on. The latest acquisition will give it a pretty firm foothold in the US, opening up yet another avenue which may see it launch into alternate products as well.