Eyeing deeper strategic cooperation in the home entertainment sector, Japan’s Sony Corp announced on Tuesday that it had reached an initial agreement with China’s home appliance heavyweight TCL Electronics Holdings Ltd for the establishment of a joint venture to take over the former’s home entertainment business.

According to a memorandum of understanding, the proposed joint venture would be held 51 per cent by TCL and 49pc by Sony, and would operate globally across the full value chain — from product development, design and manufacturing to sales, logistics and customer services — covering products such as televisions and home audio systems.

The two companies plan to negotiate a legally binding final agreement by the end of March, with the new company expected to begin operations in April 2027, according to the announcement.

“We firmly believe that this strategic cooperation with Sony presents an excellent opportunity for both sides to integrate their strengths and support further business growth,” Du Juan, chairwoman of TCL Electronics Holdings, said.

The new venture will draw on Sony’s long-standing strengths in audio-visual technologies, brand value and operational and supply chain management, while integrating TCL’s advanced display technologies, global scale, comprehensive industrial footprint, end-to-end cost efficiency and vertically integrated supply chain advantages to drive future growth, the two groups said.

This article was originally published on China Daily, an ANN partner of Dawn.