MUMBAI: French electronics major Thomson SA and TCL International Holdings Limited, the leading multimedia consumer electronic products manufacturer in China, today announced the signing of a binding memorandum of understanding (MoU) to form a joint venture company TCL-Thomson Electronics.
 

The merger of the two groups will create the world's biggest television maker. According to a joint statement issued by the two companies, annual shipment is expected to reach 18 million units after merger. TCL-Thomson will have leading market presence in Asia, Europe and North America and cost-efficient industrial presence near all major consumer markets, the statement says. The joint venture is two-thirds owned by TCL and one-third by Thomson.

The marriage between TCL, with its leading position in the China market, and Thomson, a major player in North America and Europe, will achieve significant revenue and operational synergies, the statement says.

The new company will be principally engaged in the development, manufacturing and distribution of a full range of television and DVD products. It will adopt a multi-brand strategy, using differing brands to penetrate different markets.

The TCL brand will be the key brand used in the Asian and emerging markets, while the Thomson brand will be the major brand in Europe, and the RCA brand in North America. Other brands of the parents will also be promoted in response to market needs.

The new company will have an extensive sales network offering full coverage in China via 20,000 sales outlets, and in North America and Europe via major retailers

TCL is slated take over the venture within 18 months, Thomson said. That deal would involve a share swap that would make Thomson the largest shareholder of the Chinese company, which currently has a market value of $1 billion, Reuters reports.