Galaxy maker Samsung today announced it is purchasing Harman International for $112.00 per share in cash in a deal valued at approximately $8 billion. If the deal goes through, it’ll be Samsung’s largest acquisition to date. With the purchase of Harman Samsung is essentially buying a competitive advantage as it looks to take on Apple’s rumored Project Titan and the CarPlay platform, Android Auto and other automotive systems.
The South Korean conglomerate said that Harman’s experience “designing and integrating sophisticated in-vehicle technologies, as well as its long-term relationships with most of the world’s largest automakers” will help create growth opportunities for the combined business.
Harman designs and engineers connected products for automakers and consumers, including connected car systems, audio and visual products, enterprise automation and connected services.
“The vehicle of tomorrow will be transformed by smart technology and connectivity in the same way that simple feature phones have become sophisticated smart devices over the past decade,” Young Sohn, Samsung’s president and chief strategy officer, said in a statement.
Samsung believe the acquisition will “elevate user experiences” across its complete portfolio of consumer and professional products and systems. It gives Samsung access to Harman’s management team and 8,000 software designers and engineers who will work closely with Samsung’s Automotive Electronics Business Team.
“As a Tier 1 automotive supplier with deep customer relationships, strong brands, leading technology and a recognized portfolio of best-in-class products, Harman immediately establishes a strong foundation for Samsung to grow our automotive platform,” said Oh-Hyun Kwon, Vice Chairman and CEO of Samsung Electronics.
Samsung expects the market for automotive electronics, its strategic priority, to grow to more than $100 billion by 2025. More than 30 million vehicles currently use Harman technology, with nearly two-thirds of Harman’s $7 billion of reported sales during the 12 months ended September 30 automotive-related.
Headquartered in Stamford, Connecticut, Harman maintains operations in the Americas, Europe and Asia. It has more than twenty brands under its fold, including AKG Acoustics, AMX, Crown Audio, Harman/Kardon, Infinity, JBL, JBL Professional, Lexicon, Mark Levinson, Martin, Revel, Soundcraft and Studer.
Many of these brands are expected to “greatly enhance the competitiveness” of the South Korean company’s mobile, display, virtual reality and wearable products to deliver a “fully differentiated audio and visual experience for customers”.
Photo: Harman Kardon Sound Sticks and Jony Ive-designed iSub subwoofer system.
Source: Samsung