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Samsung Electronics (005930.KS) agreed to acquire Harman International Industries (HAR.N) for $ 8 billion, marking a significant step toward entering the automotive electronics market. South Korean companies to date the largest overseas acquisitions.

The deal underscores Samsung's efforts to break into the car sector, which has been a low-profile and high-profile vehicle, before the company's strategy of avoiding major mergers and acquisitions.

"Such a large M & A deal for us is the first time, but this shows that the company under the leadership of Vice President Li Zaibei is changing, looking for new growth path is open," a understanding of the transaction situation The source said.

Harman is headquartered in Stamford, Connecticut, USA and provides solutions for automotive manufacturers such as audio systems. The acquisition of the company is also part of Samsung's efforts to find new areas of development. Cover7 Note7 smart phone due to fire problems and stop production, so that the development of Samsung's mobile phone business to slow down.

The wider use of automotive electronics and software, and the ability to link smart devices to smartphones, providing new opportunities for technology companies.

"We've been studying the car market for some time, and we've come to the conclusion that there is no way we can reach our goal fast enough to grow by ourselves," Samsung Sohn president and chief strategy officer, Young Sohn, said in a conference call.

"Samsung is not going to get into the auto industry," he says.

Samsung agreed to cash at a cash price of 112.00 US dollars to buy Harman International Industry, compared with Haman Friday closing price premium of 28%.

Harman shares soared 25.6% to more than a year the highest level.

"In our view, Harman in the display and cockpit electronics products are losing a significant place, and Samsung has these products," Baird Equity Research said in the report.

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