Kenwood and JVC May Merge
Matsushita, of which JVC is a subsidiary, had been looking to sell for several months. A likely buyer emerged in talks with various investment groups. However, that arrangement fell through when JVC's earnings fell and the front runner lowered its offer.
Instead JVC and Kenwood will merge into a holding company, according to the Japanese business daily Nikkei. If all goes according to plan, according to the press report, they'll reach an agreement by the end of this month and integrate the two companies in 2008. However, both companies tersely denied the report, saying nothing has been decided yet.
JVC was founded in 1927 as the Victor Company of Japan. It was originally a subsidiary of the Victor Talking Machine Company of America, whose Victrola phonographs replaced cylinders with flat records. The American Victor eventually merged with the Radio Corporation of America, which became better known as RCA, while the Japanese Victor became a subsidiary of Japan’s Matsushita. JVC is best known for inventing the VHS videocassette, which trumped Sony's Beta format.
Today JVC's product line includes D-ILA rear-projection HDTVs, some truly innovative surround receivers, and other video and audio products, both consumer and pro. JVC is also the patron saint of the JVC Jazz Festival in the U.S.
Kenwood was established in 1946 as the Kasuga Radio Co. The company was instrumental in launching transistorized products in Japan. It began marketing in the U.S. in 1963 and launched its first car audio products in 1980. Car audio and navigation products dominate its consumer product line, though the company also makes networking surround receivers.
The merger is the latest in a series of consolidations in the a/v industry.
What will happen to the brands remains to be seen. However, similar mergers--like the folding of Denon and Marantz into DM Holdings--have left the brands intact. And the product lines of JVC and Kenwood are fairly divergent, with little overlap. I'm especially fond of JVC and hope its idiosyncratic creative spirit survives.