China’s LeEco has agreed to acquire U.S. consumer electronics company, Vizio, for $2 billion USD, the Chinese company said on Tuesday. It comes as the Chinese internet company is seeking to expand its product line and ecosystem into the U.S.
According to a release from LeEco, Vizio offers a “steady install base of users and a brand that is both popular and successfully distributed throughout major North American retail channels.
Under the deal LeEco will operate Vizio as a subsidiary, taking responsibility for the U.S. company’s hardware business as well as their smart TV ecosystem. LeEco will own 49 percent of Vizio’s data business, Inscape, with the remaining 51 percent held by Vizio founder William Wang.
It follows much speculation that lead up to the deal, which began negotiations after Vizio abandoned plans for an IPO last year amid shaky stock market conditions.
Vizio founder and CEO William Wang admitted that he had “mixed feelings” about letting go of the 14-year-old company. Vizio, which has previously boasted a majority American staff, has built a brand on their homegrown image.
LeEco CEO Jia Yueting has been a staunch critic of traditional manufacturers and tech companies, including Apple, whose individual app ecosystem he has dubbed “outdated.”
LeEco has planned a product launch in the U.S. in September, which is expected to be their mobile handsets. The launch was delayed by two months.