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-   -   Sound United Enters Agreement to Acquire Onkyo Home Audio (https://www.avsforum.com/forum/90-receivers-amps-processors/3067612-sound-united-enters-agreement-acquire-onkyo-home-audio.html)

imagic 05-14-2019 08:00 PM

Sound United Enters Agreement to Acquire Onkyo Home Audio
 
In a major move that’s sure to reverberate through the entire AV industry, Sound United has entered a “term sheet” agreement to acquire Onkyo Home Audio. If the deal goes through, that brings Onkyo, Integra, Pioneer and Pioneer Elite brands under the same roof as Denon, Polk Audio, Marantz, Definitive technology, HEOS, Classé and Boston Acoustics.

This preliminary agreement sets the stage for negotiations to close the deal. If it goes down, current Sound United CEO Kevin Duffy will be the CEO of the whole operation.

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,” said Kevin Duffy. “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.

Sound United expects to reap benefits from this requisition, if it goes through. The company says that the additional brands will allow it to “better innovate across product categories, feature sets, technology partners, and consumer targets.” According to the press release, the acquisition would include all worldwide third-party distribution agreements under which the Pioneer and Onkyo brands are sold at this time.

The combined engineering expertise of the companies under the Sound United umbrella make a (the) major force to be reckoned with in the AV industry. After all, the press release leads with the bold claim that the combined companies would create the “World’s strongest portfolio of premium audio brands.

Please remember, this is not yet a done deal. There is the old due diligence, financing, regulatory approval, and final “definitive agreement” that all have to be hammered out before we can say this is final. But, my guess is that there wouldn’t even be a press release if there wasn’t a significant chance that this is going to happen. What comes next is anyone’s guess, but there is no question that Sound United is now poised to be the undisputed king of AV receivers. If the acquisition goes through, Denon, Marantz, Pioneer, Pioneer Elite, Onkyo and Integra all end up part of one big family.

GIEGAR 05-14-2019 08:12 PM

Quote:

Originally Posted by imagic (Post 58049460)
... If the acquisition goes through, Denon, Marantz, Pioneer, Pioneer Elite, Onkyo and Integra all end up part of one big family.

Farewell Audyssey MultEQ. It was nice while it lasted... :crying:

cTwining 05-14-2019 09:04 PM

Quote:

Originally Posted by GIEGAR (Post 58049502)
Farewell Audyssey MultEQ. It was nice while it lasted... :crying:


GIEGAR,

Isn't Sound United _already_ the parent company of Denon & Marantz ?

Carl

HDspecialist 05-14-2019 09:32 PM

So DEI Holdings is the parent company of Sound United. And there's a former US congressman involved in DEI, besides the initials of the company/man.


So is this all to avoid recent tariffs, thus keeping prices down?

I would seriously investigate this if I had a paycheck to do it.

KMFDMvsEnya 05-14-2019 09:53 PM

Things are about to become even more expensive.


https://i.pinimg.com/originals/63/bd...6b541bf9ad.gif

gene4ht 05-14-2019 10:04 PM

Quote:

Originally Posted by KMFDMvsEnya (Post 58049762)
Things are about to become even more expensive.


https://i.pinimg.com/originals/63/bd...6b541bf9ad.gif

Indeed competitive pricing will now take a back seat. However, the technical and management synergy of the combined entity should result in a win/win for both Sound United and consumers. Should this deal go through, I would be looking forward to some exciting product development and offerings.

Mark: Any gut feel you may have been privey to relative to potential time frames?

GIEGAR 05-15-2019 12:31 AM

Quote:

Originally Posted by cTwining (Post 58049662)
GIEGAR,

Isn't Sound United _already_ the parent company of Denon & Marantz ?

Carl

True Carl. What I'm facetiously suggesting is if Sound United does buy these four brands with proprietary RC routines, they'll ditch Audyssey (and attendant licencing fees) on D&M in favour of one of their own routines as they look for production efficiencies across their stable of brands. Hope I'm wrong though.

jaychatbonneau 05-15-2019 12:39 AM

Quote:

Originally Posted by HDspecialist (Post 58049712)
So DEI Holdings is the parent company of Sound United. And there's a former US congressman involved in DEI, besides the initials of the company/man.


So is this all to avoid recent tariffs, thus keeping prices down?

I would seriously investigate this if I had a paycheck to do it.

That came out of left field. Why do you think this has anything to do with tariffs? Why do you think this merger will lead to lower prices? Let's stipulate that this merger is a tariff avoidance scheme. That is perfectly moral and legal. Let's stipulate that this merger will make AVRs much cheaper. Why do you have a problem with that?

dfa973 05-15-2019 12:50 AM

Onkyo and Pioneer were struggling for a couple of years, a surprising move from SU, but maybe not that unexpected...

Is possible that Onkyo and Pioneer will become second-tier brands besides Marantz and Denon, cheaper, with more discounts all year round... or maybe not, things are complicated with 4 brands for the same product...

So now we have receivers from (no particular order):

01. Sound United (Marantz, Denon, soon Onkyo, Pioneer (Elite), Integra)
02. Yamaha
03. Anthem
04. Arcam (owned by Harman, which is owned by Samsung...)
05. Cambridge Audio
06. NAD
07. Rotel
08. Sony
09. Emotiva
10. Trinnov
11. Monoprice
12. Storm Audio
13. ATI
14. Sherwood (Inkel Corporation, Korea - big A/V OEM player)
15. Pyle
16. LG Electronics (yes, it does some AV Receivers)

-- too many later edits to count... --

Madmax67 05-15-2019 01:07 AM

Quote:

Originally Posted by GIEGAR (Post 58049502)
Farewell Audyssey MultEQ. It was nice while it lasted... :crying:

Never know. Might be farewell AccuEQ and MCACC.

dunnersfella 05-15-2019 01:45 AM

My pick...
HEOS is combined through out the Pioneer / Integra / Onkyo range... why pay licensing to PlayFi / Flare Connect when you have something you own the IP for.
There'll be one control app to drive all 5 brands of AVR's, hopefully one that finally works.
There will be one GUI (with different brand centric skins over the top) and a generic remote control across the board (preferably the D&M one, not the horrid Ponkyo version).
Rack ears will be kept for the Integra's (same with HDBaseT out etc)... but ultimately I believe things will become homogeneous, leaving consumers with less real choice.


Basically the main brands will be...

DenrantPonkegra
Yamaha
Sony


Arcam, Anthem, NAD etc will fight out to create a niche within a niche.
The thing is though, AVR sales are declining, so what's the point of owning 5 x AVR brands?

Brian Hampton 05-15-2019 03:00 AM

Seemed to me like Onkyo tried to offer cheaper versions of Denon products.

If this acquisition fights tariffs because these guys were always the same team all along... I don't see any problem with that really. There's laws and there's loop holes and sometimes the laws punish the wrong people and the loop holes represent justice.

The Onkyo HF app on my iPhone is the only Onkyo product I ever owned and it's great... :) Lets my iPhone have a real purpose being my portable high res audio player. (Thank's to USB DAC named Dragonfly.)

Dave-T 05-15-2019 04:40 AM

If this goes through Audyessy will become stronger because Denon and Marantz are the manufacturers that use Audyessy. So I would think AccuEQ and MCACC would be toast not the other way around. How could this go thorough because wouldn't Sound United be considered a monopoly?

imagic 05-15-2019 04:46 AM

Quote:

Originally Posted by Dave-T (Post 58050322)
If this goes through Audyessy will become stronger because Denon and Marantz are the manufacturers that use Audyessy. So I would think AccuEQ and MCACC would be toast not the other way around. How could this go thorough because wouldn't Sound United be considered a monopoly?

I do not think you can be a monopoly when your competitors include Sony, Yamaha, and Harman, not to mention a number of smaller manufacturers.

GIEGAR 05-15-2019 04:47 AM

Quote:

Originally Posted by Madmax67 (Post 58050018)
Never know. Might be farewell AccuEQ and MCACC.

We can only hope Max! ;)

KidHorn 05-15-2019 05:07 AM

I would imagine audyssey would lower their prices before losing their entire market. Maybe even sell themselves to SU.

So, realistically, the competition will be between SU and Yamaha. No serious audiophile buys Sony and the other brands are priced too high for mainstream. This will be bad for consumers.

pnkflyd51 05-15-2019 05:09 AM

Ugh, this is terrible news. Mergers like this are always about reducing cost and reducing competitive pricing pressure.

I do know that compared to 20 years ago (I'm 45), very few of my acquaintances are interested in dealing with home audio beyond a sound bar, so I wouldn't be surprised if the market is shrinking, but...

I finished my basement last year. I have been wanting to purchase a low end 11.2 receiver for a 7.2.4 system. 9.2 receivers are down to $600 and yet the least expensive 11.2 I see is around $1400. $800 for just two more amps? With less competition, I suspect there will be much less impetus to drive down new/better features to lower price range SKUs. I was hoping to see an 11.2 receiver <= $800 by 2020, now with all these important brands having one corporate driver, I'm not so sure.

At least I wired my ceiling for six locations- so if I do go with a 7.2.2 system I've got wires "in the middle" of my ceiling.

Pitbull0669 05-15-2019 05:24 AM

They are deff cornering the market with 80% of the brands. At least those new brands HOPE will get stepped up to some of the others

Wookii 05-15-2019 05:32 AM

Quote:

Originally Posted by imagic (Post 58050332)
I do not think you can be a monopoly when your competitors include Sony, Yamaha, and Harman, not to mention a number of smaller manufacturers.

Whilst not precisely a monopoly, the proposed acquisition is certainly monopolistic behaviour, designed to reduce competition. In the UK we have a 'Competition Commission', a government body that prevents such mergers of UK based companies if their total market share after the acquisition is likely to infer a monopolistic position. I assume there is a similar government organisation in the US, that would surely need to look into a transaction like this?

Tsunamijhoe 05-15-2019 05:38 AM

No matter who owns Onkyo, that brand is dead to me after 3 failed hdmi boards across 3 models.


That said, this will almost certainly mean higher overall prices. Buyouts are never for the consumers benefit.

S_rangeBrew 05-15-2019 06:20 AM

Quote:

Originally Posted by dfa973 (Post 58049996)
Onkyo and Pioneer were struggling for a couple of years, a surprising move from SU, but maybe not that unexpected...

Is possible that Onkyo and Pioneer will become second-tier brands besides Marantz and Denon, cheaper, with more discounts all year round... or maybe not, things are complicated with 4 brands for the same product...

So now we have receivers from:

1. Sound United (Marantz, Denon, soon Onkyo, Pioneer, Integra)
2. Yamaha
3. Anthem
4. Arcam
5. Cambridge Audio
6. NAD
7. Rotel


3 to 7 have always been "way past the point of diminishing returns" overpriced niche stuff in my opinion.


Any reason you left out Sony? Looks to me we are down to 3 mainstream receiver companies: Sony, Yamaha and this... thing.


Quote:

Originally Posted by pnkflyd51 (Post 58050382)
I have been wanting to purchase a low end 11.2 receiver for a 7.2.4 system. 9.2 receivers are down to $600 and yet the least expensive 11.2 I see is around $1400.


Maybe MSRP. I just picked up a Onkyo TX-NZ830 7.2.4 receiver for $550. Just needed to add one amp for the rear surrounds. Works very well.

nbk13nw 05-15-2019 06:25 AM

Same here, Onkyo TX RZ830 paired with an AudioSource AMP100VS for 7.4.4. Around $650.00 for 7.x.4.

dfa973 05-15-2019 06:34 AM

Quote:

Originally Posted by S_rangeBrew (Post 58050620)
3 to 7 have always been "way past the point of diminishing returns" overpriced niche stuff in my opinion.

Indeed!

Quote:

Originally Posted by S_rangeBrew (Post 58050620)
Any reason you left out Sony?

No reason, memory failure...

Quote:

Originally Posted by S_rangeBrew (Post 58050620)
Looks to me we are down to 3 mainstream receiver companies: Sony, Yamaha and this... thing.

Market consolidations and mergers are a sure sign that the pie is getting smaller and smaller every year...

drh3b 05-15-2019 06:57 AM

Quote:

Originally Posted by GIEGAR (Post 58049980)
True Carl. What I'm facetiously suggesting is if Sound United does buy these four brands with proprietary RC routines, they'll ditch Audyssey (and attendant licencing fees) on D&M in favour of one of their own routines as they look for production efficiencies across their stable of brands. Hope I'm wrong though.

Unfortunately, I'll bet you're right. In any case, I have no plans to replace my Denon, and by the time it dies, maybe something affordable with Dirac will be available that interests me. Hopefully all the affordable and semi affordable brands that are using it will have more polished products available by then.

drh3b 05-15-2019 07:00 AM

Quote:

Originally Posted by Wookii (Post 58050450)
Whilst not precisely a monopoly, the proposed acquisition is certainly monopolistic behaviour, designed to reduce competition. In the UK we have a 'Competition Commission', a government body that prevents such mergers of UK based companies if their total market share after the acquisition is likely to infer a monopolistic position. I assume there is a similar government organisation in the US, that would surely need to look into a transaction like this?

Yes, but it has been mostly ineffective for years.

drh3b 05-15-2019 07:02 AM

Quote:

Originally Posted by S_rangeBrew (Post 58050620)
3 to 7 have always been "way past the point of diminishing returns" overpriced niche stuff in my opinion.


Any reason you left out Sony? Looks to me we are down to 3 mainstream receiver companies: Sony, Yamaha and this... thing.





Maybe MSRP. I just picked up a Onkyo TX-NZ830 7.2.4 receiver for $550. Just needed to add one amp for the rear surrounds. Works very well.

I think NAD is interesting because of Dirac at a semi reasonable price.

RUR 05-15-2019 07:02 AM

Quote:

Originally Posted by S_rangeBrew (Post 58050620)
3 to 7 have always been "way past the point of diminishing returns" overpriced niche stuff in my opinion.

NAD, at least, offers a budget-friendly (relative to others) product which includes SotA RC in Dirac. IMHO, that's a big deal. YMMV.

M Code 05-15-2019 07:28 AM

Not surprising.. :rolleyes:
@ 2019 CES this rumor was circulating...
Onkyo Corp. has been shopping for a buyer for the last year 18 months...
So far United Audio has done a commendable job, repositioning Marantz & Denon after their dismal marketing slide under D&M Holdings.. United has some creative execs so now we'll see how they do with Pioneer and Onkyo. I was told they will not emphasize Integra or Elite but instead concentrate on Pioneer & Onkyo brands promoting them to the broader/mid AVR market retail segments while protecting the significantly improved distribution channels for Denon & Marantz as step-up profit lines supporting more value-added home automation, connectivity and installer features. Their target is Yamaha who is #1 , we will have to wait & see how well they do..

Just my $0.02... ;)

JayNTee 05-15-2019 07:35 AM

Quote:

Originally Posted by dfa973 (Post 58049996)
Onkyo and Pioneer were struggling for a couple of years, a surprising move from SU, but maybe not that unexpected...

Is possible that Onkyo and Pioneer will become second-tier brands besides Marantz and Denon, cheaper, with more discounts all year round... or maybe not, things are complicated with 4 brands for the same product...

So now we have receivers from:

1. Sound United (Marantz, Denon, soon Onkyo, Pioneer, Integra)
2. Yamaha
3. Anthem
4. Arcam
5. Cambridge Audio
6. NAD
7. Rotel
8. Sony (late added)


Emotiva, Trinnov and Monoprice as well? I'm sure there are a few others.

KidHorn 05-15-2019 07:48 AM

Quote:

Originally Posted by S_rangeBrew (Post 58050620)
I just picked up a Onkyo TX-NZ830 7.2.4 receiver for $550. Just needed to add one amp for the rear surrounds. Works very well.

$499 on amazon now. I had no idea you could get a 11 channel receiver for that cheap. I paid $1800 for my Yamaha 3050 a few years back and this seems to be about the same thing.

At least if my 3050 dies, I can get a cheap replacement.


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