iPhone manufacturer Foxconn buys Belkin for $800m
The Chinese giant further diversifies its business to prevent over-reliance on Apple
Chinese manufacturing giant Foxconn has made an agreement to purchase Wi-Fi, networking and accessories company Belkin for $866 million, further diversifying its portfolio outside of supply chain services.
Foxconn is one of the world's biggest electronics manufacturers, and counts companies like Google, Acer, Sony and Huawei among its customers. It is perhaps best known for being the primary manufacturing partner for Apple's iPhone devices.
However, in an effort to reduce its reliance on supply chain clients like Apple, the company has spent the last few years diversifying its business. In 2016, Foxconn acquired Japanese consumer electronics mainstay Sharp in a $3.5 billion deal in order to fuel this effort.
Similarly, Foxconn's purchase of Belkin - which also covers Belkin subsidiaries Linksys, Wemo and Phyn - gives the Chinese firm a foothold in many lucrative markets, including home and business routers, enterprise networking equipment, smart home devices and more.
Foxconn's bid to diversify may be motivated largely by self-preservation. Apple has gradually moved more and more of its manufacturing in-house, which has led to various partners being suddenly left out in the cold.
British graphics firm Imagination Technologies experienced this last year; the company put itself up for sale last year, after Apple announced that it would be terminating its contract with the company in favour of developing its own graphics chips.
Belkin and its sub-brands are expected to operate as a separate subsidiary of Foxconn under its existing executive team, while Belkin CEO Chet Pipkin is expected to join the Foxconn management team.
"[Foxconn] is excited to acquire Belkin and its capabilities in the premium consumer products space," said Foxconn CEO Sidney Lu. "Integrating Belkin's best-in-class capabilities and solutions into [Foxconn], we expect to enrich our portfolio of premium consumer products and accelerate our penetration into the smart home."
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