Samsung Electronics, the world's largest maker of smartphones, chips and TVs, said Monday that it had agreed to buy Harman International Industries, the U.S.-based auto parts supplier, for 8 billion U.S. dollars in cash.
The South Korean company said in a statement that Harman shares were valued at 112 U.S. dollars apiece, 28 percent higher than the closing price in New York on Friday.
It is the largest acquisition by a local company of a foreign firm in history, indicating Samsung's push to become one of global auto parts leaders.
Harman is the market leader in connected car and audio systems, including embedded infotainment, telematics, connected safety and over-the-air solutions. It generated 700 million U.S. dollars in operating profit on revenue of 7 billion dollars in the past 12 months.
Samsung expects the connected car solutions market to expand from 45 billion dollars in 2015 to around 100 billion dollars in 2025.
"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 Kwon Oh-hyun, vice chairman and chief executive of Samsung Electronics.
"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," Kwon added.
