Samsung is making bigger moves into the electric vehicle (EV) realm with news that its “materials and energy” subsidiary Samsung SDI has acquired the battery pack division of Magna International, an automotive supplier based in Ontario, Canada.
The Korean electronics giant is procuring the battery business from Magna Steyr, the Austria-based unit of Magna International, with more than 250 employees, all production sites, and contracts transferring over to Samsung SDI.
This isn’t Samsung’s first foray into cars, as Samsung SDI has been working on lithium-ion battery cell technology with BMW since 2009, and the two companies recently announced an extension to their deal for two electric models in particular — the BMW i8 and i3.
Also, back in December, Samsung’s investment arm, Samsung Ventures, led a $17 million investment round in Seeo to help build better batteries for electric cars.
Founded in 1970, Samsung SDI started out as a producer of cathode-ray tubes for televisions, before entering the energy industry in 2002.
Since then, it has produced a range of batteries and energy-storage products, including small lithium-ion batteries, materials for semiconductors and displays, and car batteries.
The subsidiary trades as a separate entity on the Korean stock exchange, and was one of six firms to be fined 1.47 billion euros ($1.7 billion) by EU antitrust regulators in 2012 for price-fixing of cathode-ray tubes.
Samsung says it expects this acquisition to “enhance Samsung SDI’s capabilities in batteries for electric vehicles by combining the company’s established leadership in battery cells and modules with Magna’s expertise in battery packs,” according to the press release.
Financial terms of the deal aren’t being divulged; however, the deal is expected to close by summer 2015, with the fruits of the deal expected to boost Samsung SDI’s automotive clients in Europe, North America, and China.
Samsung’s interest in the automotive industry extends beyond that of its subsidiary, as the company has previously filed for patents in the U.S. and South Korea for technology that can be used in plug-in electric vehicles.
These include technology required for making “on-board electronics for information sharing between the car and driver.”
Samsung has denied it plans to enter the industry, but with Samsung SDI expecting the market for EVs to reach 7.7 million vehicles by 2020, up from 2.1 million in 2014, it’s clear that the tech titan is going at least some way towards future-proofing its business, should the industry start to flourish.
By Paul Sawers