Samsung Electronics Co., Ltd. (005930) is headquartered in South Korea and is one of the world’s largest electronics companies. It is the largest company under the Samsung Group, one of the famous South Korean chaebols. Chaebols are powerful business groups whose companies are controlled by a single-family dynasty and often receive preferential tax treatment and subsidies from the government. Although the chaebols are facing increasing criticism for their ownership structure and involvement in corruption scandals, they have played an important role in South Korea’s rapid expansion from an agricultural economy to one of the world’s largest economies centered on manufacturing and high technology. Important role. Samsung Electronics was founded in 1969, originated in the early stages of this transformation, and quickly became one of the pillars of the Korean economy.
Today, Samsung produces popular products such as the Galaxy series of smartphones, tablets and laptops. The company also sells industrial electronic products, including electrical appliances, semiconductors, memory chips and integrated systems.In 2019, the company reported annual profits of 18.7 billion U.S. dollars and revenue of 197.7 billion U.S. dollars.Samsung’s market value is 287 billion U.S. dollars (based on the Korean won to U.S. dollar exchange rate KRW/USD = 0.000822839 as of June 17, 2020).
For most of the past 5 years, Samsung Electronics expanded mainly through internal growth. But in recent years, the company has executed a number of key acquisitions to support and accelerate its expansion, including in the areas of cloud computing and artificial intelligence.Some of these deals focus on technology to meet the growing demand for products and services related to the emerging Internet of Things (IoT). We will describe five of these acquisitions in more detail below. Samsung only announced the revenue and operating profit of one of the acquisitions.
Harman International Industries
- Business type: audio, video and connection companies
- Purchase price: USD 8 billion (announced)
- Acquisition date: March 11, 2017 (completed)
- Annual net income (2019): USD 8.3 billion (based on KRW/USD as of June 17, 2020 = 0.000822839)
- Annual operating profit (2019): USD 265.2 million (based on KRW/USD as of June 17, 2020 = 0.000822839)
Samsung’s acquisition of Harman International Industries in 2017 was its largest acquisition in history. Founded in 1980, Harman International is an electronics company based in Connecticut that designs and designs connected products and solutions for consumers, automakers, and other companies. Its products include connected car systems, audio-visual products, enterprise automation solutions, and services that support the Internet of Things. The company’s products are sold under leading brands such as Harman Kardon, Infinity, JBL and Mark Levinson.Samsung Electronics acquired Harman to expand its global influence in the fields of smart audio, interconnection and automotive technology, with a special focus on cars becoming more and more automated and interconnected.
- Business type: smart home and IoT applications
- Purchase price: estimated at $200 million
- Acquisition date: August 15, 2014 (acquisition announcement)
SmartThings was established in 2012 to design software applications and operate an open platform for consumers to use in smart homes. SmartThings also uses the Internet of Things. The platform enables users to monitor, control and automate their homes from anywhere through a mobile application. SmartThings can be used to turn on the lights when the user wakes up and turn off the lights when off work; it can lock the door and turn on the security camera; it can alert the homeowner of water leakage or unexpected activity; it can turn on music, other household appliances, etc.Samsung Electronics acquired SmartThings in 2014 and incorporated it into the Samsung Open Innovation Center (OIC), which is responsible for bringing software and service innovation to the company.SmartThings is part of Samsung’s promotion of interconnection technology and the Internet of Things.
LoopPay (now Samsung Pay)
- Business type: digital wallet platform
- Purchase price: approx. 250 million USD
- Acquisition date: February 18, 2015 (acquisition announcement)
LoopPay was established in 2012 to provide a digital wallet platform that supports contactless payment solutions.The platform uses the company’s patented Magnetic Secure Transmission (MST) technology, which was developed thanks to Samsung’s early investment. Samsung subsequently acquired LoopPay in 2015 to strengthen its ability to provide seamless, secure and reliable mobile wallet solutions.Samsung subsequently used the intellectual property rights belonging to LoopPay to create Samsung Pay.Samsung’s mobile payment application directly competes with Apple’s (AAPL) Apple Pay application, as both companies are eager to increase service revenue.
Telecom World Solutions
- Business Type: Internet Service Provider
- Purchase price: undisclosed
- Acquisition date: January 13, 2020 (acquisition completed)
Founded in 2002, TeleWorld Solutions is a network service provider providing wireless engineering and consulting services.The company focuses on 5G cellular network technology, the intersection of artificial intelligence (AI) and wireless networks, smart city infrastructure, machine learning, and the Internet of Things.Samsung Electronics acquired TeleWorld Solutions in January to enhance its capabilities in network infrastructure, especially in 5G.TeleWorld represents another step forward in Samsung’s goal of becoming a leader in smart infrastructure and the Internet of Things.
- Business Type: Organic Electronics
- Purchase price: US$347 million
- Acquisition date: August 9, 2013 (announced)
Novaled was founded in 2001 as a spin-off from two leading German research institutions, the Technical University and the Fraunhofer Institute.The company provides proprietary organic materials and complementary innovative technologies for high-quality organic light-emitting diodes (OLEDs) used in digital displays and lighting.The acquisition of Novaled helped Samsung significantly improve the quality of its TVs and other screens in the highly competitive electronics market.
Samsung Electronics Diversity and Inclusive Transparency
As part of our efforts to raise awareness of the importance of company diversity, we emphasized the transparency of Samsung Electronics’ commitment to diversity, inclusion, and social responsibility. The figure below illustrates how Samsung Electronics reports on the diversity of its management and workforce. This shows whether Samsung Electronics disclosed data on the diversity of its board of directors, top management, general managers, and all employees in various indicators. We have used ✔ for transparency.
|Samsung Electronics Diversity and Inclusion Report|
|Race||gender||ability||Veteran status||Sexual orientation|
|Board of Directors|