It’s a name that many of us would more readily associate with smartphones such as the Le Max 2, but at a press conference held in Los Angeles this morning, LeEco announced that it acquiring television manufacturer Vizio for $2 billion. The announcement, which has been rumored for a while, will result in Vizio becoming a subsidiary of LeEco.
Vizio is an incredibly popular brand of televisions in the US, offering great value for the budget-conscious consumer over the past few years, and for the foreseeable future at least, it would seem that the brand will carry on as normal in the States. Vizio’s management will stick around, and the company will still be based in Irvine, California. William Wang, the founder, Chairman, and Chief Executive Officer of Vizio had this to say about the deal:
“I’m excited to see how LeEco’s global reach and resources will elevate VIZIO as we continue to bring great technology, innovation and value to our consumers.”
As is natural with acquisitions, there will be some noticeable changes ahead, with Vizio televisions adopting LeEco’s TV software at some point in the future. This could be a natural progression on LeEco’s part with the recent opening of a new headquarters in Silicon Valley as well as the rumored launch of a video streaming service in the US later this year. Vizio’s data business, Inscape, will become a privately held company with Vizio’s founder, William Wang, retaining 51% control and LeEco the remaining 49%.
Whether the deal also means that LeEco will introduce its range of smartphones to the US via its distribution channels is anyone’s guess, it may just be possible that LeEco could rebrand its range of smartphones under the Vizio moniker in the US. It wouldn’t be the first time that Vizio sold smartphones, back in 2011 the company launched the VIA 4-inch smartphone and the VIA 8-inch tablet, so there is a precedent.
What do you think of LeEco’s acquisition of Vizio and the future use of LeEco’s television software? Let us know in the comments below.
Full Press Release:
Pioneering Internet Ecosystem Company LeEco Acquires VIZIO for $2B
Disruptive, first-of-its kind ecosystem model delivers new value for U.S. consumers
San Jose, CA and Irvine, CA — July 26, 2016 — LeEco and VIZIO, Inc. announced today a definitive agreement under which LeEco would acquire VIZIO, Inc. for $2 billion USD. The VIZIO hardware and software businesses will be owned and operated as a wholly owned subsidiary of LeEco, while the VIZIO data business, Inscape, will spin out and operate as a separate, privately owned company.
Recently named one of Fast Company’s 2016 “Most Innovative Companies,” LeEco is a leading global company that provides breakthrough experiences through an open, integrated ecosystem enabled by its Internet and cloud platform. LeEco develops intelligent hardware that serves as the interface to connect individuals, interact with them and to enrich their lives through premium content and applications.
“LeEco believes in breakthrough technologies, a complete ecosystem and disruptive pricing. Acquiring VIZIO is an important step in our globalization strategy and building our North American presence,” said YT Jia, Founder, Chairman and Chief Executive Officer, LeEco. “From its inception, VIZIO introduced a disruptive business model that changed the industry and aligns with our vision of breaking boundaries to deliver consumer-focused products, software and services.”
Based in Irvine, CA and founded in 2002, VIZIO is a leading consumer electronics brand in North America, with #1 unit share in Smart TVs1 and #1 unit share in Sound Bars2. The company is focused on delivering the ultimate home entertainment experience through its ecosystem of hardware, software and services. The acquisition benefits both companies with VIZIO offering LeEco a steady install base of users and a brand that is both popular and successfully distributed throughout major North American retail channels. LeEco provides VIZIO immediate global scale to bring its innovations to consumers worldwide. Like LeEco, VIZIO shares a similar vision of creating premium products with the latest innovations and making them accessible for everyone – from budget-minded students to custom home theater cinephiles – without sacrificing quality or performance.
“Fourteen years ago, I mortgaged my house to start VIZIO and since then, it has grown into one of the most well-known and respected CE brands in North America. As an entrepreneur, I couldn’t be more proud of what has been accomplished,” said William Wang, Founder, Chairman and Chief Executive Officer, VIZIO. “As we enter a new chapter with LeEco, I’m humbled by the hard work and dedication of VIZIO shareholders and employees. Their unwavering faith in the brand and commitment to excellence is what made this venture possible. I’m excited to see how LeEco’s global reach and resources will elevate VIZIO as we continue to bring great technology, innovation and value to our consumers.”
The VIZIO executive management team will remain in place and will continue its operations as an independent subsidiary from its existing headquarters in Irvine, CA. The VIZIO brand and its portfolio of products will continue to be sold through its existing distribution channels and supported by the same North American-based, award-winning customer service. William Wang will transition to Chairman and Chief Executive Officer of Inscape, with focus on the continued expansion and growth of the brand’s data business.
As part of the definitive agreement, LeEco will acquire all of the VIZIO hardware and software operations, technology and intellectual property. The transaction is expected to close during the fourth quarter of 2016, and is subject to customary closing conditions. BofA Merrill Lynch acted as advisor to the special committee of the VIZIO board of directors, and Latham & Watkins LLP served as legal counsel for VIZIO on this transaction.