Even as Connecticut’s economic development leaders toil diligently to retain and attract industry-leading businesses to the Land of Steady Habits, market forces at times pull in different directions. That is again in evidence as Samsung has announced it will buy Stamford-based Harman for $8 billion.
The acquisition of will make Samsung a major player in automotive technology, and removes an independent corporate headquarters from the state’s roster. Earlier this year, Harman was one of four Connecticut-based companies to be named among the most innovative companies by Fast Company magazine. Harman ranked seventh on the Fast Company ranking of the 10 most innovative companies in the automotive sector.
Upon closing, Harman will operate as a standalone Samsung subsidiary, and continue to be led by Dinesh Paliwal and Harman’s current management team, both companies indicated in a news release. Harman has a workforce of approximately 30,000 people across the Americas, Europe, and Asia and reported sales of $7.0 billion during the 12 months ended September 30, 2016.
“Samsung is pursuing a long-term growth strategy in automotive electronics, and plans to retain Harman’s work force, headquarters and facilities, as well as all of its consumer and professional audio brands. Samsung believes the combination will increase career development and advancement opportunities for the employees of both companies,” the news release 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,” Harman Chairman, President and CEO Dinesh Paliwal said.
For Samsung, it is the biggest overseas acquisition ever by a South Korean firm, according to the news service Reuters. The Harman acquisition is subject to regulatory approvals and is expected to close in mid-2017, reports indicate. The agreement has been unanimously approved by the boards of directors of both companies.
Harman’s products, which provide infotainment, telematics, connected safety and security services, are used in more than 30 million vehicles made by automakers such as BMW, Toyota Motor Corp and Volkswagen, according to its website. Harman’s portfolio of audio brands includes AKG®, Harman Kardon®, Infinity®, JBL®, Lexicon®, Mark Levinson®and Revel®
Harman executives will be at the Fleet Europe Forum and Awards on November 16 in Barcelona, Spain to highlight Harman’s premium products for the fleet industry , which caters to businesses, government agencies and other organizations that purchase or lease groups of vehicles to support their services.