Samsung To Acquire Connected Car Firm Harman For $8 Billion (thestack.com)

An anonymous reader writes: Samsung has announced its plans to buy car tech company Harman International for $8 billion, marking the largest ever overseas deal by a South Korean firm. The electronics giant is to purchase the connected car systems company in a push to strengthen its efforts in emerging areas as its smartphone business slows. "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 Samsung CEO Oh-Hyun Kwon. Samsung confirmed that it will acquire the Connecticut-based company for $112 per share in cash, representing a premium of 28% based on Harman's closing stock price on 11th November.

Comments

Great!

[Mikkeles]

Now we can have exploding cars!

Harman?!

[King_TJ]

Frankly, my opinion of that company isn't too high these days....

Harman is whatever's left of various mergers or bankruptcies over the years. But everything I've seen in a car with their name on it was trashy quality car audio that was clearly designed to meet some arbitrarily low price point instead of actually caring that consumers had a true "premium" stereo.

EG. The Chrysler Crossfire came with a Harman-Becker radio and amp. The system used small subwoofers as the rear two speakers, and put full range components in the doors for the front. They didn't use a proper crossover in the circuit though, so everything sounded relatively muddy, or alternately, the rear subs barely ever fired if you adjusted it to be "treble heavy". Many of the Crossfire owners I know had these head units go bad on them too, over the years. So yeah, the cars are around 10-12 years old now -- but still, the stereo didn't last as long as the rest of the electronics in many of them.

Re:Harman?!

[ChrisMaple]

Harman is the upgrade alternative for most auto manufacturers over the standard radio. The other major supplier is Bose, which often uses inferior (more efficient but higher distortion) switching amplifiers.

Harman has accumulated many brands including JBL, and if the whole company is going to become part of Samsung it's a disaster for the American audio industry.

I worked for Harman for a few years and the high levels of management considered the employees to be serfs. In that regard, it's hard to see how Samsung could be worse.

Connected Car and more

[BenJeremy]

I interviewed with Harman (I have a couple of ex-colleagues who work there) and Red Bend a while back. It's not a bad acquisition for Samsung, and will give them more than a foot in the door with automotive technologies. Some of the tech (particularly Red Bend's OTA update tech) is transferable to mobile devices, as well.

Re:Car Tech?

[Jack Kolesar]

That's not true at all. The car and "Connected Technologies" portion of the company is their LARGEST section. The pro audio/video stuff is insignificant. I was actually just down at AMX in Richardson a few months ago. Harman has a TON of software developers and a lot of IP. In fact, I wouldn't be surprised if they split up and tried to sell a lot of those Pro A/V companies. I can't imagine a JBL speaker being branded Samsung and I don't know of any Samsung companies where they do not use the Samsung name. They purchased this PRIMARILY for automotive in my opinion.

Re:Car Tech?

[Desler]

No it appears you don't. According to their most recent quarterly results out of $1.7 billion sales that:

"Connected car" = $797 million
"Lifestyle audio" = $568 million
"Professional solutions" = $240 million
"Connected services" = $167 million

So, no, their "car stuff" is not the smallest part of their business. It is the largest part at 45% of their quarterly net sales.