Report: Samsung Drops Acquisition Of Fiat's Magneti Marelli

Advertisement
Advertisement

A few months ago, reports emerged that Samsung is looking to acquire Magneti Marelli, Fiat Chrysler Automobiles' car components business. While the South Korean tech giant was allegedly only interested in telematics, in-car entertainment, and lighting operations owned by Magneti Marelli, the conglomerate was reportedly willing to purchase the entire operation for more than $3 billion. To say that this report excited Fiat Chrysler's stockholders would be an understatement as the company's shares experienced a huge surge following it. While $3 billion isn't a lot of cash for a tech conglomerate like Samsung Electronics, this theoretical acquisition would have still marked Samsung's largest corporate purchase ever made outside of its home country of South Korea.

It would have, but it won't. Namely, as Korean news outlets are now reporting, the Seoul-based tech giant dropped the idea of acquiring Magneti Marelli. According to several industry sources, the main reason for this turn of events is Samsung's recent purchase of Harman International Industries, a Connecticut-based connected car system manufacturer. More specifically, even though Samsung will reportedly pay approximately $8 billion for Harman, it abandoned the Magneti Marelli acquisition not solely because of money, but because it wanted to avoid making overlapping investments.

In addition to that, Korean media outlets are reporting that Samsung also had trouble with negotiating the price of Magneti Marelli with Fiat Chrysler, as the latter reportedly wanted more than $3 billion for its car components business. As things stand right now, Fiat Chrysler Automobiles is considering spinning off Magneti Marelli if it fails to sell the business by the end of 2017, just like it did with Ferrari last year.

Advertisement

As for Samsung, this turn of events isn't surprising in light of company's recent announcement that it's streamlining its operations. The Seoul-based tech giant recently sold its printing business to HP and is reportedly looking to sell its PC-making division to Lenovo. While Samsung views connected car technologies as one of its largest growth axes, the tech giant apparently didn't deem haggling over Magneti Marelli worth it as such a purchase would also require some degree of consolidation between Fiat Chrysler's division and Harman. Given how mergers take time and Samsung is in the business of making money, Fiat Chrysler Automobiles will have to find a potential suitor for Magneti Marelli elsewhere.

Share this page

Copyright ©2016 Android Headlines. All Rights Reserved.

This post may contain affiliate links. See our privacy policy for more information.
Advertisement

Dominik started at AndroidHeadlines in 2016. He’s approaching his first full decade in the media industry, with his background being primarily in technology, gaming, and entertainment. These days, his focus is more on the political side of the tech game, as well as data privacy issues, with him looking at both of those through the prism of Android. Contact him at [email protected]

View Comments