Chinese electronics company TCL announced plans to invest HKD120 million to acquire a color TV plant in Mexico from Sanyo.

TCL said that the two parties signed an asset acquisition agreement on March 31, 2014. Under the agreement, TCL will pay a total amount of USD15.22 million to Sanyo, including USD13.27 million for the land, factory buildings, and equipment of the color TV plant in Mexico; and USD1.95 million for a 90% stake in Sanyo's Mexican subsidiary. Meanwhile, Sanyo agreed to purchase a certain amount of TV sets from TCL over the next four years.

Sanyo's Mexican subsidiary is engaged in the production and sales of electronic consumer products, including TV sets. In 2013, its net profit before taxes was HKD3.49 million. Reports in Japanese media revealed that this company produces TV sets for Wal-Mart. In 2012, its annual sales reached 1.7 million sets. After acquired by TCL, the company will continue to accept TV production orders from Wal-Mart.

TCL's board of directors believed that this deal will help improve the company's production and operation efficiency, lower average production costs, and promote overseas market expansion, especially the North and South American markets.

The deal is expected to close at the end of April 2014.

As a leading color TV maker in China, TCL continues to expand its overseas businesses. In 2013, TCL sold 17.184 million LCD TVs, representing a year-on-year increase of 10.7%. In 2014, the company aims at global sales of 18.5 million TV sets.