Over-The-Air Updating Technology and Services for Connected
Car
HARMAN International Industries, Incorporated (NYSE:HAR), the
premier audio, visual, infotainment and enterprise automation
group, today announced the acquisition of Israeli-based Red Bend
Software, a leading provider of software management technology for
connected devices, and over-the-air (OTA) software and firmware
upgrading services. Building upon Red Bend’s strength in the mobile
and carrier markets, HARMAN will accelerate Red Bend’s growth in
the automotive space and will position Red Bend software as the de
facto standard for OTA software services for mobile devices and
automotive applications.
The transaction is valued at $170 million, including
approximately $99 million in stock and $71 million in cash. The
number of HARMAN shares issued will be based on the volume weighted
average trading price 60 days prior to January 21. Under the
agreement, the selling stockholders of Red Bend are eligible for a
cash earn-out of up to $30 million in the first quarter of calendar
year 2017 based on the achievement of certain performance
milestones.
Red Bend is the world’s leading provider of the most advanced
OTA solutions, serving top handset manufacturers and mobile
carriers with more than two billion Red Bend-enabled devices in the
market globally. Sophisticated software systems like Red Bend are
the cornerstone of a steadily increasing number of integrated and
interoperating devices, and managing updates for firmware,
middleware, third party apps, and other services.
“This acquisition of Red Bend, a true pioneer in OTA and
virtualization technologies for cyber security, adds a critical
component to our automotive systems and services portfolio that
will essentially future proof software in cars, ultimately making
them safer, smarter and more efficient,” said Dinesh C. Paliwal,
Chairman, President, and CEO of HARMAN. “Together with our Symphony
Teleca acquisition, HARMAN now has the essential foundation and
deep bench strength for a comprehensive systems and services
portfolio. Today marks a huge transformation for HARMAN and further
advancement towards delivering consumers a seamless, connected car
and connected lifestyle experience.”
“With over 15 years of success in delivering world-class
over-the-air update solutions to the telecom and mobile markets, we
are pleased to bring our proven track record to HARMAN,” said Yoram
Salinger, President and CEO of Red Bend. “By joining forces with
HARMAN, we will accelerate our growth in expanding markets such as
the connected car while also continuing to support billions of
mobile devices. Beyond mobile, Red Bend and HARMAN will implement
OTA software management to enhance infotainment and embedded system
performance as well as other in-car ECU-based systems. These
solutions will benefit the entire automotive ecosystem through cost
savings, increased security and a seamless customer
experience.”
Red Bend’s software management solutions and hypervisor-based
virtualization technologies for cyber security are already widely
adopted in mobile devices and ideally suited to meet the rising
demands of the connected car. By 2020, it is expected that more
than 90 percent of vehicles on the road will be connected (Frost
and Sullivan). Importantly, Red Bend solutions also serve as
critical prerequisites for autonomous driving. By bringing Red Bend
under the HARMAN umbrella and driving broad industry usage,
HARMAN’s combined technology portfolio will seamlessly enable safe,
secure OTA updates for a variety of on-board Harman and non-Harman
automotive systems – whether embedded or downloaded -- speeding the
pace of innovation to automakers and the industry.
The Red Bend acquisition is subject to regulatory approvals and
customary closing adjustments. It is expected to close in third
quarter of HARMAN’s 2015 fiscal year.
Upon close of the transaction, Red Bend will operate within
HARMAN as an independent unit led by its existing management team,
while benefiting from HARMAN’s scale, resources, and deep
automotive domain experience. Red Bend will remain dedicated to
serving and growing its target markets, including mobile handset
OEMs, service providers, semiconductor vendors and tablet
manufacturers, as well as its growing base of automotive OEMs and
other Tier 1 suppliers.
Conference Call
The Company will host a conference call with the investment
community Thursday, January 22 at 10:00 AM EST. To participate,
dial 1-800-763-6564 (North America) or 1-212-231-2924
(International), Access Code 21760117.
A replay of the call will also be available following its
completion at approximately 1:00 p.m. EST. To listen to the
replay, dial 1-800-633-8284 (U.S.) or 1-402-977-9140
(International), Access Code 21760117.
About HARMAN
HARMAN (www.harman.com) designs, manufactures and markets
premier audio, visual, infotainment and enterprise automation
solutions for the automotive, consumer and professional markets.
With leading brands including AKG®, Harman Kardon®, Infinity®,
JBL®, Lexicon®, Mark Levinson ® and Revel®, the Company is admired
by audiophiles, musicians and the entertainment venues where they
perform. HARMAN has a workforce of approximately 16,600 people
across the Americas, Europe, and Asia and reported sales of $5.6
billion for the 12 months ended September 30, 2014. The Company’s
shares are traded on the New York Stock Exchange under the symbol
NYSE:HAR.
About Red Bend Software
Red Bend catalyzes change in the connected world. We have been
keeping more than two billion mobile, automotive and IoT devices
continuously relevant with over-the-air software updates, and with
virtualization and device management services. Our robust
technology and solution offerings deliver instant market impact —
accelerating business results, optimizing performance and improving
people’s lives. Building on nearly two decades of experience, and
on our proven track record working with hundreds of leading global
brands, we make it easy for customers across all geographies to
optimize deployment of change, and reliably enhance any connected
device — regardless of size and complexity — with ever-increasing
value. For more information, visit www.redbend.com.
© 2015 HARMAN International Industries, Incorporated. All rights
reserved. Harman Kardon, Infinity, JBL, Lexicon and Mark Levinson
are trademarks of HARMAN International Industries, Incorporated,
registered in the United States and/or other countries. AKG is a
trademark of AKG Acoustics GmbH, registered in the United States
and/or other countries.
Photos/Multimedia Gallery Available:
http://www.businesswire.com/multimedia/home/20150122005522/en/
HARMANDarrin Shewchuk,+1 203 328 3834Director, Corporate
Communicationsdarrin.shewchuk@harman.com
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