Samsung is acquiring Harman for $8 billion in cash, the company announced today.
The deal will give Samsung a presence in the rapidly growing market for connected technologies, particularly automotive electronics, which has been a “strategic priority” for the company. More than 30 million vehicles are currently equipped with Harman’s connected car and audio systems, including embedded infotainment, telematics, connected safety and security.
“Harman perfectly complements Samsung in terms of technologies, products and solutions, and joining forces is a natural extension of the automotive strategy we have been pursuing for some time,” said Oh-Hyun Kwon, Vice Chairman and Chief Executive Officer of Samsung Electronics.
Samsung says that Harman’s experience designing and integrating in-vehicle technologies, as well as its long-term relationships with automakers, will create growth opportunities for the combined business by enabling it to leverage Samsung’s expertise in connected mobility, semiconductors, user experience, displays and its global distribution channels.
“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,” added Kwon.
“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,” said Young Sohn, President and Chief Strategy Officer of Samsung Electronics.
“Samsung is an ideal partner for Harman and this transaction will provide tremendous benefits to our automotive customers and consumers around the world,” the company’s CEO, Dinesh Paliwal, said. “Partnerships and scale are essential to winning over the long term in automotive as demand for robust connected car and autonomous driving solutions increases at a rapid pace.”
Harman will operate as a standalone Samsung subsidiary, and continue to be led by its current management team. Samsung plans to retain Harman’s work force, headquarters and facilities, as well as all of its consumer and professional audio brands.
Competitors to Harman’s effort include QNX, owned by BlackBerry, and Tesla, as well as Apple (possibly in the future, anyway) and many traditional carmakers, including Ford and BMW.