Japan's Pioneer Corporation and KKR have signed a share purchase agreement under which the former's business division that engages in the development, manufacturing and sale of DJ equipment will be spun off into a new company, Pioneer DJ, which will be jointly owned by both companies.

Based on this agreement, KKR will acquire all of the outstanding shares of Pioneer DJ via holding company PDJ Holdings Co., Ltd. (PDJHD) for approximately 59 billion yen (US$551 million). Pioneer will then acquire newly issued shares in PDJHD. The new company owned 85.05% by KKR and 14.95% by Pioneer.

Pioneer's DJ equipment business develops, manufactures, and sells equipment for DJs, including DJ players, mixers, controllers, headphones, and speakers.

Pioneer and KKR will jointly leverage their respective business resources, brand power, and technological capability, as well as global-technology and media-industry investment experience, and networks for the further growth of Pioneer DJ.

Susumu Kotani, representative director, president and CEO of Pioneer, said, "As we accelerate our efforts to concentrate management resources on our car electronics business, Pioneer has been seeking the optimal partner to further the globalization of our DJ equipment business and expand the brand. We are pleased to have reached an agreement with KKR on the purchase of Pioneer DJ. KKR has a wealth of experience in the technology and media industry globally, and we are confident it has the expertise to drive Pioneer DJ forward. Pioneer will retain 14.95% of the voting rights in Pioneer DJ and we will maintain a framework for cooperation to ensure the future growth of the company."

Subject to approval by the relevant authorities and other customary closing conditions, the agreements are expected to be completed by March 2015.