Sound United is boldly moving to add to its stable of AV home theater brands after announcing plans Tuesday to acquire the rights to a stable of major trademarks from Onkyo Corp.’s consumer audio division, including Onkyo, Integra, Pioneer and Elite.

Onkyo Corp. later clarified that it has entered into a non-binding term sheet to transfer its Home AV business to Sound United. The term sheet will enable both companies to “accelerate negotiations of definitive terms and agreements to close the deal.”

Under the plan, Onkyo Corp. is to retain the rights to the Pioneer and Onkyo brands for their Digital Life and Embedded Audio businesses, while Sound United acquires all worldwide third-party distribution agreements under which the premium audio products are currently sold.

Significantly, current distribution by Onkyo USA in the Americas and Aqipa in Europe will be unaffected by the transaction.

That means that the Onkyo Group will now focus on new user experiences outside the home and will continue to expand its OEM and licensing business for audio solutions in the car and white goods. 

When completed, Sound United, which is a DEI Holdings company, will add the additional home audio brands to its already large stable that includes: Denon, Marantz, Polk Audio, Classe, Definitive Technologies, Boston Acoustics and HEOS.

The expanded operation would give Sound United a considerable stake of the global home theater audio business, leaving Sony, Yamaha, Harman Kardon (owned by Samsung) and an assortment of other mostly high-end and boutique brands as the primary competitors in the audio video receiver, integrated amp and separate home theater audio component businesses.

Sound United will face more competition in the speaker and sound bar ends of the home audio business, however.

Other terms were not disclosed and the deal still awaits stakeholder and regulatory approvals. Sound United’s annual meeting is scheduled for next month.

It will be fascinating to see how Sound United plans to juggle all of its brands, which could have significant overlap on a number of fronts.

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“We are thrilled by the opportunity to add the venerable Onkyo and Pioneer brands to our portfolio. Sound United is one of the leading dedicated providers of premium audio/video products, and we believe the combined businesses will bring unrivaled innovation and sound performance to our consumers and channel partners,” Sound United CEO Kevin Duffy said in the statement disclosing the deal.

Duffy is to remain as CEO of the combined operation.

“Upon completion of the transaction, we will work tirelessly with the consumer audio division of Onkyo Corporation to ensure a seamless transition into the Sound United family so that all employees, customers and channel partners benefit from the enhanced breadth and depth of the new organization,” Duffy stated.

By Greg Tarr

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