Chinese Camera Module Maker O-Film to Acquire Sony Electronics Huanan

11 Nov

O-Film Tech, a Chinese touchscreen panel and camera module manufacturer, announced Nov. 7 that it will acquire Sony’s Chinese subsidiary Sony Electronics Huanan for US$234 million, Japan’s Nikkei reported.

The report said O-Film will purchase stocks and debt securities of Sony’s fully-owned Chinese subsidiary Sony Electronics Huanan for a total value of US$234 million. O-Film did not reveal when the transition will be completed.

According to the report, the staff of 4,000 people employed by Sony Electronics Huanan will also become O-Film employees. O-Film may reveal the impact of the acquisition on the revenue following transition completion. The report also said O-Film plans to invest another US$32 million after the acquisition is completed.

Established in 2004, Sony Electronics Huanan began by manufacturing AV equipment. The company started producing camera modules for phones in 2012. Camera modules and components now account for the majority of Sony Electronics Huanan’s revenues.

Published data suggested that Sony Electronics Huanan had a total asset of 3.68 billion RMB (US$541.62 million) in 2015, with a net asset of 615 million RMB. The company also had current liabilities worth of 3.07 billion RMB, revenues of 6.83 billion RMB and a net profit of 109 million RMB in that year.

Sony Electronics Huanan’s camera modules are used in smartphone vendors from home and abroad as well as Sony’s phones. However, the company has struggled with improving the yield rate. Price competition and slowing growth in the smartphone market forced Sony to list a loss of 59.6 billion Japanese yen (US$565.67 million) for Q1 2016 and another 20.3 billion yen in Q2.

Sony has halted the production of high-efficiency camera modules in its plant in Kumamoto, Japan. The sale of its subsidiary to O-Film is expected to further improve Sony’s financial situation.

O-Film is based in Guangzhou and its clientele includes Xiaomi, Huawei, OPPO and Samsung. O-Film’s sales of camera modules grew from 587 million RMB in 2013 to 5.49 billion RMB in 2015, and are projected to reach between 9 billion and 9.5 billion in 2016.
(Photo courtesy of Flickr/Masaru Suzuki CC BY 2.0)