Wednesday 12, September 2018 by Bloomberg

Pioneer to get $538 million bailout from Baring Private Equity

 

Pioneer Corp., once among the world’s hottest names in technology before struggling with debt and failed expansions, agreed to a bailout from Baring Private Equity.

Baring Private Equity will buy as much as JPY 60 billion ($538 million) of stock in the Tokyo-based company, according to a filing on Wednesday. Pioneer will get a JPY 25 billion bridge loan ahead of the share sale and said it plans to remain publicly traded.

Shares of Pioneer fell as much as 13 per cent in Tokyo as the company said the deal isn’t legally binding yet and talks are continuing.

Pioneer became a household name in the 1980s with its home and car stereo systems but has struggled for years after failed expansions into new markets left it saddled with debt. Last month it said there was uncertainty it could continue as a going concern as it heads toward a full year operating loss.

The company helped change karaoke in the 1980s with laser discs, invested heavily in plasma televisions and introduced the world’s first commercial OLED display for a car stereo in 1999. But it was unable to build a sustainable market in those sectors and was caught out by changes in technology.

More recently it has focused on car navigation systems as it seeks to break into the autonomous car market.

Pioneer now has total debt of JPY 50.3 billion, according to data compiled by Bloomberg.

Features & Analyses

Economics Adapting to a new era

  Abdullah Al-Fozan, Chairman of KPMG MESA and KPMG Saudi Arabia, provides an exclusive commentary on the Kingdom’s business… read more