Samsung to buy US auto parts supplier
SAMSUNG Electronics is buying US auto parts maker Harman International Industries for US$8 billion in a bid to enter the growing market for automotive technology to produce “connected” cars.
The deal, the biggest in the firm’s history, will provide a chance for the tech titan to move past the Galaxy Note 7 crisis that is expected to cost it billions of dollars as well as its cherished reputation.
Board members of Samsung approved the all-cash deal of the Connecticut-based firm for US$112 a share, Samsung said. The deal will give the South Korean giant a “significant presence” in the global market for online-connected auto parts, the firm said in a statement.
“Harman perfectly complements Samsung in terms of technologies, products and solutions, and joining forces is an extension of the automotive strategy we have been pursuing,” Samsung vice chair Kwon Oh-Hyun said.
“Harman immediately establishes a strong foundation for Samsung to significantly grow our automotive platform.”
Harman produces high-end audio systems and other internet-enabled entertainment features for global carmakers including General Motors and Fiat Chrysler.
Samsung Electronics produces a wide range of electronics from smartphones to home appliances and semiconductors.
The latest deal will offer the firm a chance to combine Harman’s expertise in high-tech auto parts and its own mobile and semiconductor technologies, Samsung said.
Samsung is hoping to complete the deal by the third quarter of 2017 after getting approvals from shareholders and regulators.
The deal comes as the firm seeks new sources for growth beyond its key business of mobile handsets as the market slows. –