SEOUL -- LG Electronics strengthened its component business for vehicle hardware and software by acquiring Israel's cybersecurity platform developer Cybellum in a deal that would reach about $110 million. The home appliance maker regards cybersecurity as an important element in next-generation vehicles which are evolving into complex systems connected with numerous components
LG Electronics said it has signed a contract to secure a 63.9 percent stake worth $89.46 million in Cybellum. Additional shares would be acquired by the end of this year. The South Korean company signed a separate $20 million investment agreement that would be converted into stocks.
Along with Cybellum, which develops a cybersecurity platform designed to provide software risk assessment by detecting vulnerabilities automatically without source code, LG Electronics aims to raise the cybersecurity competitiveness of its vehicle component business to the world's highest level.
"The acquisition of Cybellum will be an opportunity for LG Electronics, which has systematically prepared for the era of future connected cars, to introduce its cybersecurity competitiveness to the global market," Kim Jin-yon, an LG Electronics vice president in charge of vehicle component solutions, said in a statement on September 23.
LG Electronics said the acquisition of Cybellum reflects efforts to reorganize its vehicle component business into three axes -- infotainment, powertrain and lighting. Cybellum's cybersecurity capabilities would be utilized to provide reliable parts and services to carmakers.
The acquisition is significant as cybersecurity has become an important criterion for determining the quality of automobiles throughout their lifecycle including design, development, and operation, said LG Electronics, which closed its troubled smartphone business in April as part of a group-wide strategy to put more resources into other viable sectors such as robotics, organic light-emitting diode technology and vehicle components.
LG Electronics has beefed up capabilities to manufacture infotainment systems and powertrain parts for carmakers. In December 2020, LG Electronics and Canada's mobility technology company Magna International agreed to establish a joint venture and manufacture electric motors (e-motors), inverters and onboard chargers for electric vehicles, along with electric powertrain systems.
In July 2021, LG Electronics agreed to form a consortium with the University of Toronto and develop artificial intelligence algorithms for autonomous vehicles that can recognize objects more accurately. ZKW, an Austrian lighting system producer acquired by LG Electronics, and partner companies are working on the development of new micromirror modules, a complicated device that can specifically and precisely shoot laser beams. Such modules will enable smart light functions for autonomous vehicles.
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