Samsung to buy car tech company Harman for $8bn
Deal marks strategic shift for the electronics company which has previously shunned big acquisitions
The purchase of the maker of connected car and audio systems is part of Samsung’s search for new growth areas as its smartphone business slows
Samsung Electronics has agreed to buy Harman International Industries in an $8 billion (€7.46bn) deal, marking a major push into the auto-electronics market and the biggest overseas acquisition ever by a South Korean company.
The transaction highlights Samsung’s efforts to break into the high-barrier automotive industry where it has little track record and also marks a strategic shift for the electronics company, which has previously shunned big acquisitions.
“An M&A deal this big is a first for us. But it shows that under Jay Y Lee the company is changing and open to new ways to grow,” a source familiar with the deal said, referring to Samsung Electronics’ vice-chairman.
The purchase of the maker of connected car and audio systems is part of Samsung’s search for new growth areas as its smartphone business – scarred by the withdrawal of the fire-prone Galaxy Note 7 – slows.
“We have been studying the automotive market for some time. We conclude that organic growth will not get us where we want to go fast enough,” said Young Sohn, president and chief strategy officer of Samsung Electronics. “Samsung will not get into the business of manufacturing cars.” – (Reuters)