Connected Chinese consumer electronics maker LeEco on Tuesday agreed to buy discount California smart TV maker Vizio Inc. to expand in the U.S. market and add TVs to its line of phones, cars and bikes.

Shanghai-based LeEco would pay $2 billion for Vizio's TV business but will leave the target's Inscape data gathering division with Vizio founder and CEO William Wang.

"From its inception, VIZIO introduced a disruptive business model that changed the industry and aligns with our vision of breaking boundaries to deliver consumer-focused products, software and services," said LeEco founder, chairman and CEO YT Jia in a statement.

The acquisition switches off plans for an initial public offer at Vizio. The company was founded in 2002 by Wang, who mortgaged his house and pulled in cash from friends to launch the discount flat-panel TV maker. Irvine, Calif.-based Vizio excelled by contracting out manufacturing while focusing sales on warehouse retailers. The company now reportedly has more than $3 billion in annual sales.

"I'm excited to see how LeEco's global reach and resources will elevate VIZIO as we continue to bring great technology, innovation and value to our consumers," Wang said.

Vizio's current management will remain with the company with the exception of Wang, who will become chairman and CEO of Inscape. Inscape provides intelligence on viewing habits and grew out of the connected technology in Vizio sets.

Customer demands to be connected wherever they are with unlimited access to content is driving much of the recent tech-related dealmaking. Cellphone giant Verizon (VZ) - Get Report on Monday agreed to buy ailing Internet company Yahoo! (YHOO) for $4.8 billion to boost its content and targeting portfolio.

And Japanese Verizon rival SoftBank Group, which operates Sprint in the U.S., last week agreed to buy U.K. chipmaker ARM Holdings (ARMH) for $32 billion. SoftBank wants to profit as more and more devices become connected, often using ARM chips, on the Internet of Things through SoftBank cell networks.

Tuesday's agreement is expected to close in the fourth quarter. Beijing-based LeEco is formally known as Leshi Internet Information & Technology Corp.