A power struggle in the karaoke industry has come to a dramatic end with leader Neway Karaoke Box yesterday confirming it has taken over rival California Red.
The move, which gives Neway a market share of more than 90 per cent, in effect creates a rare monopoly. It has also left consumer rights advocates worried that karaoke enthusiasts might suffer from a lack of competition.
There had been speculation about the takeover for weeks, following the departure of several members of the top management of California Red, including founder Anthony Lock Kwok-on.
Neway said in a statement that the takeover was completed last Monday and the company had acquired 'the brand, the business, the network and relevant assets of California Red'.
The company did not reveal how much it paid for its rival.
It said both brands would co-exist, while a restructuring would take place to improve efficiency.
At least three California Red branches - at Tai Kok Tsui, Ngau Tau Kok and Tsuen Wan - were understood to be closing from today. Neway declined to comment last night.