Samsung Just Agreed To Buy This Company For $8 Billion

Samsung Electronics has agreed to purchase Harman International Industries, in what would be the biggest overseas acquisition ever by a company in South Korea.

In a deal valued at $8 billion, Samsung would be purchasing the maker of connected car and audio systems, in an effort to grow business outside of smart phones. Since Samsung’s Galaxy Note 7 was recalled because it was fire prone, its smartphone business has slowed.

According to the company’s website, Harman’s products provide infotainment, telematics, connected safety and security services. They are used in more than 30 million vehicles included vehicles by Toyota Motor Corp, BMW, and Volkswagen.

A source familiar with the deal who spoke to Reuters, said, “”An M&A deal this big is a first for us. But it shows that under Jay Y. Lee, the company is changing and open to new ways to grow.” Jay Y. Lee is Samsung’s Vice Chairman.

“We have been studying the automotive market for some time. We conclude that organic growth will not get us where we want to go fast enough,” Young Sohn, President and Chief Strategy Officer of Samsung Electronics, said on a conference call.

The company will acquire Harman for $112.00 per share in cash, which is a 28 percent premium to the company’s closing price on Friday.

Disclaimer: We have no position in Harman International (NYSE: HAR) and have not been compensated for this article