Samsung eyes the growing market for connected cars with $8-billion acquisition of Harman

A man with a mobile phone walks by Samsung Electronics logos at the compnay's headquarters in Seoul on Dec. 12, 2013.

By Associated Press

Nov. 13, 2016 11:58 PM PT

Reporting from Seoul —

Samsung Electronics said Monday it has agreed to acquire auto-systems maker Harman for $8 billion as the South Korean giant eyes the growing market for connected cars.

Samsung said in a statement that it will pay $112 per share in cash for the Stamford, Conn.-based company, making the acquisition Samsung’s biggest ever.

Overseas acquisitions are high on Samsung’s agenda. Last month, the company bought artificial intelligence firm Viv Labs, founded by creators of Apple’s Siri. It also recently bought a cloud service company, a mobile payments firm and a connected-home startup.

Harman provides connected cars and audio systems with safety and entertainment features. More than 30 million cars are equipped with its auto systems. The majority of its $7 billion in annual sales during the year that ended Sept. 30 came from auto-related technologies.

“Upon closing, the transaction will immediately give Samsung a significant presence in the large and rapidly growing market for connected technologies, particularly automotive electronics, which has been a strategic priority for Samsung,” the company said in a statement.

Samsung is a latecomer to the market for connected cars. In December 2015, the company made its ambitions for the self-driving-car sector known by announcing that it will create a business division to focus on auto systems and components for autonomous driving. Apple and Google were already working with global automakers to supply their auto systems, CarPlay and Android Auto.

The company said it plans to keep Harman as an independent subsidiary and retain its management team. Samsung’s automotive electronics business team will work closely with Harman’s management, it said.

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UPDATES:

Nov. 14, 4:50 a.m.: This article has been updated with additional information on the deal and background on Samsung’s connected-car market.

This article was originally published Nov. 13 at 11:55 p.m.