Samsung to Flex Its Financial Muscles

Samsung Electronics' booth at SEDEX in October 2020

J.P. Morgan suggested in a recent report that Samsung Electronics may consider acquiring a U.S. automotive semiconductor company, Barron’s, an influential U.S. investment magazine, reported on April 21.

The possibility of Samsung Electronics acquiring an automotive semiconductor company has been steadily raised. At the beginning of 2021, reports came out that Samsung Electronics was interested in acquiring Dutch company NXP. But J.P. Morgan says that NXP is not the only M&A target for Samsung Electronics.

According to the report, Samsung Electronics’ M&A targets may include Texas Instruments (TI), Microchip Technologies, and Analog Devices. It said chances of acquiring ST Micro Electronics and Infineon are small.

The average market capitalization of the six companies mentioned by J.P. Morgan is US$68 billion (about 76 trillion won). As of the third quarter of 2020, Samsung Electronics had a total of 116 trillion won in cash.

Choi Yoon-ho, CFO of Samsung Electronics' Management Support Office, said at a conference call in January that the company will strategically expand facility investment and promote M&A deals, using its financial resources, to strengthen its market-leading position in the semiconductor industry and solidify its foundation for sustainable growth in new industries.

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