Samsung’s plans to purchase Fiat Chrysler subsidiary Magneti Marelli are no longer, with the South Korean tech giant backing out of the deal due to funding and a potential conflict of interest with its other business ventures.
FCA was looking to sell Magneti Marelli, which supplies lightning components and other parts for Fiat Chrysler vehicles, to Samsung for around $3 billion earlier this year. The tech company has now backed out of the deal after it acquired connected car systems manufacturer Harman Industries for $8 billion.
While the $8 billion acquisition in Harman is fairly significant, Samsung decided to abandon Magneti Marelli deal not because of money but out of a desire to not make overlapping investments. Samsung’s purchase of Magneti Marelli would have given it access to various car electronics systems developed by the company.
Additionally, Samsung also had problems reaching a deal with FCA on Magneti Marelli. FCA CEO Sergio Marchionne wanted more than $3 billion for the subsidiary and Samsung wasn’t willing to pay-up. Rumors indicate FCA will continue to shop the company around and will spin the company off in an IPO if it cant find a buyer by the end of 2017.