Samsung is set to take over distribution of Harman consumer audio products worldwide, according to senior Company sources at CES 2017.
ChannelNews understands that once the deal that is currently facing legal hurdles is done Samsung subsidiaries around the world are expected to take control of the several audio brands that Harman currently own.
In Countries where Samsung do not have a subsidiary operation distributors will be used.
The Harman brands include KG Acoustics, AMX, Crown Audio, Harman/Kardon, Infinity, JBL, JBL Professional, Lexicon, Mark Levinson, Martin, Revel, Soundcraft and Studer brands.
Several of these brands were displayed on the Samsung stand at CES 2017, in particular the Mark Levinson brand that is currently distributed by Advanced Audio.
In Australia, all the premium brands are expected to be distributed by Convoy who currently distribute the JBL and Harman Kardon, premium sound range.
Samsung Australia is expected to take over the Harman Kardon and JBL Consumer brands.
A Samsung executive at CES said “We are currently working on a business plan for Harman consumer products. We are currently reviewing Harman sound technology for use in several Samsung consumer products while also reviewing how the many Harman products will be distributed in the future. We anticipate that the consumer products will be distributed by Samsung as we have relationships with the same retailers where Harman consumer products are currently being sold” they said.
They went on to say that Harman premium sound products will not be distributed by Samsung, instead the Korean Company plans to use audio distributors who already have a relationship with specialist audio retailers.
Last year Harman moved to set up a local subsidiary in Australia after parting Company with NSW distributor Convoy.
This operation which is now based in Balmain in New South Wales, is expected to be rolled into the Samsung Australia operation.
It’s not known at this stage whether Samsung Australia will take liability for the current lease, or how many current Harman staff will be employed by Samsung Australia.
Last November, Samsung Electronics announced it would acquire US-based automotive and audio system maker Harman International for $8 billion. Initially Samsung said that they intend to tap into Harman’s automotive business and incorporate its high-end audio solutions in future products.
Last week Harman shareholders filed a class action lawsuit against the company’s CEO and board, in a bid to deter the finalisation of the deal. According to the shareholders, Harman International’s value has been greatly depreciated, thus resulting in an inadequate and flawed merger deal.
The lawsuit alleges that Harman CEO Dinesh Paliwal and the board of the company did not act in good faith in striking the deal with Samsung.
The shareholders will try to exercise their right to vote against the merger in a bid to stop the finalization of the $8 billion deal no later than November of this year.
If the deal falls through and relations between the two companies go sour, we may never see a Samsung flagship smartphone with Harman’s high-end audio tech built-in.