Samsung acquires Harman to grab share of connected car market

Samsung Electronics has agreed to buy US automotive parts maker Harman International Industries for $8bn cash as part of a strategic swoop into the fast-growing 'connected car' market.

The acquisition, which is Samsung's largest overseas acquisition, adds to Samsung's presence in an automotive electronics market that is expected to grow to more than $100bn by 2025.

Harman is the market leader in connected car solutions, with its technology in more than 30m vehicles currently, including embedded infotainment, telematics, connected safety and security.

Roughly 65% of Harman’s $7.0bn of sales during the 12 months ended September 30 are automotive-related, and its order backlog for this market at June 30, 2016 was approximately $24bn.

“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.

He added: “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. We see substantial long-term growth opportunities in the auto technology market as demand for Samsung’s specialized electronic components and solutions continues to grow."