Samsung Ventures Out to Connected Cars, Buys U.S. Audio Company Harman for $8 Billion

Samsung Electronics has entered into a definitive agrrement that it will acquire U.S. audio company Harman International Industries, Inc. for $8 billion, all cash, the Korean company giant's biggest purchase so far with the car-tech market, which could signal its interest in the automotive industry.

After acquiring Harman and obtaining its supplies and technology, Samsung might actually extend to the automotive industry.

According to The Wall Street Journal, Samsung has declared to pay $112 worth of share in cash for Stamford, Conn.-based Harman.

“That is a 28 percent premium over Harman’s Friday closing price. The company’s shares surged 25 percent Monday, but closed at $109.72, under Samsung’s offer price,” reported the Wall Street Journal.

Harman is more popular with its Harman Kardon speaker and other audio devices. Under the management of its chief executive Dinesh Paliwal, the company was expanded into creating components for connected cars such as navigation systems, Wireless connectivity, and software development.

Aside from the Harman Kardon, Harman also owns numerous brands such as AKG and JBL. These other productions are expected to make the company more profitable. Recently, the company has also made an arrangement with General Motors and Fiat Chrysler earning an approximate $24 billion worth of deals.

Samsung might actually venture on a higher shift towards innovative cars and vehicles including driverless variants with display panels, mobile services and semiconductors according to the report.

"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 in a press release.

It has been the biggest deal of Samsung after its Galaxy Note 7 fiasco. This new venture on the vehicle industry might be the “key for driverless technology” and “internet-connected cars” that will be used in engine problems and crash alerts.

"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," Young Sohn, Samsung's president and chief strategy officer, said in a statement.