With most of the Silicon Valley tech companies, including Google and Apple, working on their individual autonomous electric automobiles. Korean multinational giant Samsung is also gearing up to bolster its automotive plans.
It is currently amid advanced talks to acquire some or all of the operations of auto-parts maker Magneti Marelli from Fiat Chrysler Automobiles NV, reports Bloomberg. Sources close to the development say that the company is particularly interested in Magneti Marelli’s lighting, in-car entertainment and telematics business.
As stated above, Samsung could consider the acquisition of the whole company, or even a part of it. The transaction is expected to amount to more than $3 billion and the company will try to close the same by the end of this year, says one of the sources. This will also account for Samsung’s biggest acquisition outside South Korea. Both the companies have declined to comment on these reports.
Since the reports of such an acquisition have flooded the Internet, the share prices of Fiat Chrysler have risen up 9 per cent to 5.95 euros. This might also be Fiat’s biggest one-day gain since October 2014.
Samsung is aggressively pushing to go beyond its consumer electronics and smartphone business to join others in researching, building and becoming a part of the autonomous and connected economy. Around the end of 2015, the Korean giant had put together a team of engineers to work on the development of automobile components, in-car entertainment and autonomous driving.
Samsung recently has been showing that it is actually quite serious about its autonomous vehicle. It has also acquired a stake in Chinese electric car manufacturer BYD Co. for a reported $450 million(3 billion yuan). It aims to create synergies and strengthen their respective verticals of electric cars, semiconductors, and smartphones. Samsung, at MWC has also announced that it has forged an alliance with automobile manufacturer SEAT (part of Volkswagen group), and software corporation SAP SE to showcase the cutting-edge concepts in the high-tech automobile industry.
Italy-based Magneti Marelli, a subsidiary of Fiat Chrysler, is best known for the development and manufacturing of systems, modules and high-technology components for the automotive industry. It has years of experience in satellite navigation, connectivity, infotainment and telematics systems — connectivity with other electronic devices.
Marelli had earlier teamed up with Samsung to develop display products for entertainment, information and navigation in 2009. This acquisition could help Samsung in expanding global sales of its displays using lighting solutions, and open up access to supply parts for some of Fiat’s luxury brands, specially Maserati.
This synergy will also give it the much needed ground for the development of parts for the electric car. BYD Co. could also benefit from this deal as it will have access to a global automotive parts leader. Since the sources detail that the two companies are amid advanced talks, so we could hear the news of acquisition pretty soon.