According to latest reports from South Korea, Samsung SDS is close to selling its home Internet of Things (IoT) business to Allegion, an Irish provider of security products and services. Executives of Samsung's subsidiary have allegedly already informed their employees that a sale is on the horizon. Allegion has been negotiating with Samsung SDS for several months now over a sale of the company's smart lock business. However, in a surprising turn of events, the Dublin-based firm decided that it's best to acquire the entire home IoT unit of Samsung SDS. Furthermore, Business Korea reports that both parties are willing to wrap up the deal as soon as possible as Allegion is already performing its due diligence and should give Samsung its initial valuation of the said home IoT unit by the end of the year.
Interestingly enough, this wouldn't be Allegion's first acquisition in South Korea. Last year, the company purchased Milre Systek, the biggest supplier of smart door locks in the country. Milre Systek is now reportedly facing production issues as the company's lacking enough skilled workforce, which is why Allegion is looking to consolidate it with Samsung SDS' home IoT unit. Of course, provided that the Irish company manages to acquire it. Most market watchers are baffled by this turn of events given how Samsung SDS was extremely enthusiastic about its IoT business lately. However, this move could be explained as a part of Samsung's long-term strategy to streamline its operations. Namely, Samsung Electronics is also running its own IoT division so it's possible that the South Korean tech giant believes the two units are overlapping.
Samsung's new business strategy recently resulted in a sale of the company's printing business to HP, while the firm is reportedly also looking to sell its PC unit to Lenovo. Samsung opted for concentrating its operations a few months ago after the conglomerate lost approximately $3 billion following the second recall of the Galaxy Note 7. However, it isn't clear whether the said fiasco directly prompted this change in strategy given how $3 billion still isn't a lot for a company pulling in almost $200 billion in annual revenue. In any case, if Allegion and Samsung SDS manage to come to an agreement, this rumored transaction should be confirmed by spring.