Aiming a deep entry into the electric vehicle market, Samsung has decided to acquire battery business from Magna International.
Samsung’s materials and energy subsidiary, Samsung SDI has acquired the battery pack division of Magna International, the largest automotive supplier in North America, based in Ontario, Canada.
Financial terms of the deal are not divulged and the deal is expected to close by summer 2015.
“The acquisition is a key strategic step for Samsung SDI to strengthen the competitiveness of our automotive battery business,” said Namseong Cho, president and CEO of Samsung SDI. “It will provide new momentum to expand our business and customer base.”
The firm is procuring the battery business from Magna Steyr, the Austria-based unit of Magna International including 250 employees, all production sites and contracts transferring over to Samsung SDI.
The deal is expected to help Samsung to spread its automotive business further into Europe, North America, and China.
In addition, this acquisition will help to showcase Samsung SDI’s expertise in EV batteries by integrating the know-how of battery cells and modules with Magna’s capability in battery packs.
Since 2002, Samsung SDI has produced a range of batteries and energy-storage products, including small lithium-ion batteries, materials for semiconductors and displays, and car batteries.
Since 2009, Samsung SDI has been working on lithium-ion battery cell technology with BMW, with the two companies recently announcing an extension to their deal for the BMW i8 and i3.
In December Samsung Venture led a $17 million investment round in Seeo to help build better batteries for EVs.
Earlier, Samsung has filed for patents in the U.S. and South Korea for technology that can be used in EVs, including latest on-board electronics technology that enables information sharing between the car and driver.
The Samsung SDI expects that the market for EVs will reach 7.7 million vehicles by 2020 up from 2.1 million in 2014.
Sabeena Wahid
editor@greentechlead.com