Samsung’s Harman to acquire ZF’s advanced driver-assistance systems business for $1.76B – News

Samsung Electronics Co. Ltd. today announced it’s planning to acquire ZF Friedrichshafen AG’s advanced driver-assistance systems business in a deal valued at €1.5 billion ($1.76 billion).

The South Korean electronics giant said its automotive component and audio subsidiary Harman International will take over ZF’s ADAS business in order to “deliver safer, more intelligent and more intuitive in-vehicle experiences.”

ZF Friedrichshafen’s ADAS business develops advanced technologies to assist drivers, including front-facing vehicle cameras, LiDAR sensors and controllers. ADAS systems rely on these cameras and sensors to detect the environment around them, including road markings, distances to vehicles in front and behind of them and pedestrians, in order to automate vehicle operations and enhance safety for drivers.

The acquisition will accelerate Samsung’s push to diversify beyond memory chips and smartphones by increasing its exposure to vehicle electronics at a time when cars are becoming more software- and sensor-driven.

Christian Sobottka, chief executive of Harman’s Automotive Division, said the global market for ADAS and central vehicle controllers is forecast to grow from $42.18 billion in 2025 to more than $60 billion by the end of the decade. “The industry is at an inflection point where safety, intelligence and in-cabin experience must come together through a unified computing architecture,” he added.

KB Securities analyst Jeff Kim told Reuters that the acquisition will also help to strengthen Samsung’s position in the fast-growing telematics industry, which combines telecommunications and informatics to monitor and manage vehicles and assets using GPS and onboard diagnostics technologies. “As advanced driver assistance systems are increasingly becoming the core technology underpinning telematics, the acquisition of an automotive electronics supplier focused on ADAS should be viewed positively,” Kim said.

Samsung said the acquisition is set to close next year, subject to the necessary regulatory approvals.

Germany-based ZF Friedrichshafen is a global technology manufacturing giant that supplies systems for passenger cars, commercial vehicles and industrial machines. It’s one of the world’s largest suppliers of vehicle components, and last year generated revenue of more than $48 billion.

However, the company has come under pressure recently as the automotive industry struggles with weak demand for electric vehicles and global trade tensions. Earlier this year, it revealed plans to lay off up to 14,000 workers and has also accumulated a high debt burden from its own acquisitions.

ZF Friedrichshafen CEO Mathias Miedreich said Harman is the ideal partner to unlock the growth and innovation potential of the ADAS business. “At the same time, this deal makes an important contribution to reducing our company’s debt and allows us to focus our resources on the core technologies in which ZF is a global leader,” he added.

Image: ZF