Shareholders of Harman International Industries voted to approve the company's merger with Samsung that will see the Seoul-based tech giant pay approximately $8 billion for the Stamford, Connecticut-based manufacturer of connected car systems. Harman's shareholders voted on the matter last Friday and most of them have deemed Samsung's offer acceptable. The South Korean consumer electronics manufacturer is planning to complete the acquisition of Harman by the third quarter of the year, following all of the necessary regulatory approvals in the United States and several other countries. Harman's filing with the United States Securities and Exchange Commission (SEC) revealed that the company's Friday vote represented over 70 percent of its common stocks in circulation. Approximately 47 million shares voted for the acquisition while around 21 million were against it, meaning the transaction can move forward.
Samsung's acquisition of Harman has been a controversial matter that polarized shareholders of the U.S. maker of connected car systems. Some investors recently filed a class action lawsuit against Harman's Chief Executive Officer Dinesh Paliwal, as well as the company's board of directors. The plaintiffs claim that Harman's top executives severely undervalued the company while considering Samsung's offer and have consequently violated their fiduciary duties as they weren't acting in the best interest of the firm's shareholders. While industry watchers speculated the lawsuit may inhibit Samsung's plans to acquire the company, that obviously hasn't happened and a single lawsuit such as this one likely won't prevent the proceedings following Harman's vote.
This latest turn of events also shows that the recent arrest of Samsung Group's Vice Chairman Jay Y. Lee won't derail the conglomerate's existing short-term plans concerning mergers and acquisitions. While Harman's board of directors could have chosen to postpone the vote on the acquisition, it seems that the firm's top executives estimated that course of action wouldn't reflect positively on the value of the deal. Samsung's $8 billion acquisition of Harman will mark the company's largest foreign acquisition to date. In addition to the United States, the transaction has yet to be approved by antitrust watchdogs and regulators in the European Union, South Korea, and China. However, it's unlikely Samsung will face any major issues on that front and the company's acquisition may even be completed as early as mid-2017.