Published: January 22, 2015 | STAMFORD, CT, United States
HARMAN International Industries, Incorporated announced that it has signed an agreement with Symphony Technology Group to acquire Symphony Teleca, a privately-held global software services company. Symphony Teleca provides software engineering and integration services that help businesses rapidly design and develop products and technologies at the convergence of device, sensors, cloud and data. With the acquisition of Symphony Teleca, HARMAN will add a fourth division to its three primary businesses: Infotainment, Lifestyle and Professional. The transaction is subject to customary closing conditions and regulatory approvals and is expected to be completed by the end of HARMAN’s 2015 fiscal year.
Under the agreement, HARMAN will purchase Symphony Teleca for a base purchase priceof $780 million. In addition, the selling stockholders are eligible for a cash earn-out based on a calendar 2015 revenue target. Approximately $548 million will be paid at close – $382 million in cash and $166 million in HARMAN stock.
The Internet of Things (IoT) is ushering in a rapid convergence of experiences, content and commerce and advancing technology from digital to connected to intelligent systems. Software is driving this evolution and as a result, software solutions and services will be key to HARMAN’s continued success. The acquisition of Symphony Teleca is a transformative step for HARMAN that gives it immediate scale in software services. With the addition of cloud, mobility and analytics competencies, the company will accelerate solutions for the connected car and for a broader set of industries and markets.
Transaction Positions HARMAN for Continued Value Creation:
- Accelerates Innovations for Expanded Industries and Markets: Through greater global engineering scale and complimentary customer base, the acquisition will enable HARMAN to rapidly develop and commercialize more innovative solutions and systems for a broader set of industries.
- Establishes HARMAN as Unique Provider of Application Engineering Services for Connected Experiences: With the competitive advantage of established systems solutions, and global expertise across analytics, mobile development and cloud, HARMAN will be able to provide a comprehensive application services offering across the automotive, enterprise and consumer markets.
- Expands Platform for Integrated Solutions that Reflect Convergence of Telecommunications, Mobile Devices, and Automotive: This acquisition will provide HARMAN with the opportunity to meet the growing demand for integrated technologies across these fast growing and converging segments. Customers of both companies will be able to leverage a complete set of software defined services, particularly around IoT gateway, predictive analytics, cloud enablement, and turnkey mobile development and commercialization that enable everything from autonomous driving to intelligent cities.
- Deepens Technology Partnerships through Long Standing Industry Ecosystem Alliances: Symphony Teleca will bring deep expertise and scale from a number of long established ecosystem and partnerships covering Google Android, Microsoft, Adobe, Intel and other technologies. As one of the first Open Handset Alliance members and contributor to the core Google Android platform, Symphony Teleca has grown to the largest Android ecosystem scaling partner worldwide having delivered more than 800 commercial projects across different industries and device types. The Company is also a strategic cloud partner of Microsoft and has helped more than 100 customers move, scale and manage cloud platforms and infrastructure.
- Strengthens Financial Profile with More Diversified Revenue Mix: With calendar year 2014 revenues of approximately $370 million and adjusted EBITDA of approximately $60 million, the Symphony Teleca business will further enhance the Company’s growth profile.