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Rockwell Automation Inc.'s Korea unit agreed to acquire the controller division of Samsung Electronics Co.'s Mechatronics business located near Seoul, Korea, for an undisclosed amount.
The acquisition would solidify Rockwell Automation's position in Asia's industrial automation market by adding to the company's line of PLCs, motion, drives, distributed I/O and software product lines, according to a company statement, said Don Davis, chairman and chief executive officer, Rockwell Automation. “This acquisition combines the strengths of both companies. The strong brand equity of the Samsung name provides an opportunity to expand Rockwell Automation's existing operations in Korea, and brings expertise to further our design and product development capabilities. This direct business presence, combined with Rockwell Automation's thorough knowledge of control technology and advanced automation practices is the nucleus for our future commercial and operational expansion in the Asia-Pacific region.”
According to a Dow Jones report, Samsung Electronics' Korea unit had $25 million in sales in fiscal 2001 and expects to double this sales figure in 2003 including the Samsung asset buy.
This acquisition would form a new business that would operate under the Rockwell Samsung Automation name. The business would create technologies in the design and development of automation products including PLCs, drives and software.
The companies expect to complete the deal at the end of the second quarter in June.
Rockwell said it would receive a license to brand and market products with the Samsung name in the Korea market as part of the agreement. Samsung Electronics has also agreed to purchase control and other automation products from Rockwell Automation, including those produced by the new company.
The company's headquarters would be in Seoul, Korea, and the manufacturing and product development facility would be located in the Suwon City area. These operations would report to the Rockwell Automation Controls and Information business group based in Cleveland.
Samsung Electronics employs approximately 64,000 people in 89 offices in 47 countries. The company is one of the world's largest producers of memory chips, TFT-LCDs, CDMA mobile phones, monitors and VCRs.