LeEco To Buy US TV Manufacturer Vizio For $2 Billion This Year

Subject: General Tech | July 28, 2016 - 03:52 PM |
Tagged: vizio, LeEco, China, business

Chinese technology company LeEco (SZSE: 300104) will purchase US television manufacture Vizio (NASDAQ: VZIO (not trading)) in a deal worth $2 Billion USD set to close in the fourth quarter of this year. 

LeEco plans to acquire Vizio's hardware and software divisions and run the US company as a wholly owned subsidiary while spinning off Vizio's Inscape television viewership data arm as a privately held company. With approximately 400 employees, yearly revenue in the billions ($3.1 billion in 2014), and at least 20% of the US television market, the acquisition would allow LeEco to enter the US market in a big way. Vizio is best known in the US for its televisions where it is a respected brand, but the company also produces ultrabooks, tablets, smartphones, and sound bars. It is a private US-based company with manufacturing in Mexico and China.

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Founded in 2004, LeEco is involved in a number of technology related fields across China, India, and soon the US. The Vizio brand (and partnerships such as the one with Walmart to carry its TVs) alone will be instrumental in LeEco's plans to break into the US market which has been resistant to Chinese brands making inroads (Lenovo apparently being the exception, but even Lenovo was not able to get its smartphones into the US market in a big way). The company of 5000+ employees is involved in Internet TV, video production and distribution, e-commerce, smartphones, tablets, gadgets, home automation, and even (soon) driverless cars.The company had 2014 revenue of $1.6 billion.

It is interesting to see all of the buy outs of US tech companies by overseas companies. To be clear, I don't necessarily think that these deals are a bad thing or being done with malicious intentions, but they do piques my curiosity. In this case it could be a good partnership that would allow both companies to benefit with LeEco getting a strong US brand and the recognition and market trust that entails and Vizio getting a much larger staffed company with experience in Chinese markets where it could help Vizio push its smart TV platform and ultrabooks and phone aspects further. Here's hoping that a LeEco owned Vizio grows and maintains its quality and price points.

What do you think about LeEco buying out Vizio? What will the future hold for the US TV maker?

Source: Reuters

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July 28, 2016 | 06:09 PM - Posted by Anonymous (not verified)

Shame, seemed like they were just hitting their stride with the new P series. I can't imagine it getting better, but hopefully it will stay the same.

July 28, 2016 | 06:30 PM - Posted by Soloasylum

That will probably put an end to me buying vizio products.

I don't know of many acquisitions that ended up better when it came to consumer products.

July 28, 2016 | 08:15 PM - Posted by Tim (not verified)

Well sprint came to mind while writing bc if softbank buying them and they are still around... but unfortunately not much to say beyond that they are still around heh..

July 28, 2016 | 10:40 PM - Posted by BlackDove (not verified)

More cheaply made Chinese shit on the market. Another company to never buy from.

July 29, 2016 | 01:21 AM - Posted by DK76 (not verified)

Well i'll stop Buying Vizio then, i guess i'm back to buying Korean screens...

July 29, 2016 | 11:43 PM - Posted by Anonymous (not verified)

What is a US TV maker?

July 30, 2016 | 12:16 AM - Posted by Tim Verry

A company based in the US that makes branded televisions (Vizio currently uses ODM partners in Mexico and China for the actual manufacturing which I think I said in the article but maybe not.)

July 29, 2016 | 11:58 PM - Posted by Anonymous (not verified)

Not much point in buying TVs these days, as Panasonic doesn't make plasmas anymore and OLED isn't quite practical yet. Nothing but LCD garbage for now

July 30, 2016 | 08:19 AM - Posted by BlackDove (not verified)

The LG OLED TVs are worth buying fpr 1080p. 4K is a waste until they support Rec.2020.

I have a wonderful WCG-CCFL Sony LCD that puts the vast majority of W-LED backlit trash made today to shame.

Some of the new Sony and Samsungs with quantum dot LEDs are good.

However, since Rec.2020 is the biggest change in TV since color TV was invented, I would wait for a Rec.2020 OLED.

July 30, 2016 | 03:05 PM - Posted by Donald Gillies (not verified)

A close friend of mine works for Vizio but the writing is on the wall, TVs are a dying market. Samsung used to subsidize their TVs with cellphone profits but those profits have disappeared, we only need companies to make computer monitors - broadcast and/or streaming TVs are an idea whose time came, and went.

July 31, 2016 | 05:02 PM - Posted by larrym (not verified)

im sure vizio quality will decline because that's just how the Chinese are. Just like the cheap logic board in my washer that failed that used cheap chinese parts. or the psu in my samsung tv that had to have its shitty chinese caps replaced by quality japanese caps. chinese, constantly trying to screw you over with some shoddy product. its a national pasttime. oh ya forgot to mention i only use nimh aa made by panasonic because the Chinese shit stops charging after a few months

August 1, 2016 | 04:49 PM - Posted by hechacker1 (not verified)

Besides the US employees potentially losing their jobs, are all the parts in Vizio TVs basically made in China anyways?

There's only a few LCD panel manufacturers from what I remember.

I will admit though the nice thing about Vizio was at least support was based in the US.

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