Samsung has entered into an agreement to purchase JBL-parent Harman, in a move designed to give the Korean electronics giant a “significant presence” in the connected technologies market, and the automotive electronics sector in particular. Samsung will pay $112 per share in cash, making Harman worth $8bn (£6.4bn).
Automotive electronics is “a strategic priority”, the company said in a statement, and is expected to grow to $100bn by 2025. Harman is already a leader in this field: approximately 65% of Harman’s ($7bn) revenue in the 12 months ending 30 September was automotive-related. Samsung says Harman’s design and integration experience, alongside its relationships with some to the biggest car manufacturers (including, recently, General Motors and Fiat Chrysler) will create “significant growth opportunities for the combined business”.
Dinesh Paliwal, Harman chairman, president and CEO, stated: “This compelling all-cash transaction will deliver significant and immediate value to our shareholders and provide new opportunities for our employees as part of a larger, more diversified company.
Upon closure of the deal, Samsung says Harman will operate as a standalone Samsung subsidiary, and continue to be led by Paliwal and his current management team.
The announcement comes after an extended period of restructuring in Harman’s professional audio portfolio (including JBL, AKG, Lexicon, Soundcraft and Studer) whereby brands have been realigned into new divisions reflecting the integrated technology requirements of its customers: hence ‘Harman Professional Solutions’.
Samsung says Harman’s headquarters and facilities, as well as all of its consumer and professional audio brands, will be retained in the takeover.
At the time of writing, PSNEurope was seeking further clarification as to the consequences of the deal for Harman Professional Solutions.