Software management firm Red Bend Software has been acquired by audio and visual infotainment group Harman International for a fee of $170 million.

The deal seems like a good fit for Harman, which was perhaps missing a connectivity string to its bow and Dinesh C. Paliwal, chairman, president, and CEO of Harman confirmed it was a strategic purchase.

“This acquisition of Red Bend, a true pioneer in OTA and virtualisation 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,” he said.

Red Bend is a strong advocate of delta compression, which is discussed elsewhere on Connected Car, and it has more than two billion devices featuring its over-the-air software and firmware upgrade service.

Stock/cash split

Red Bend’s $170-million transaction will be split into approximately $99 million in stock and $71 million in cash, with the company’s president and CEO setting his sights on expansion and collaboration once everything is finalised in the third quarter of this year.

“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,” he said.

“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.”

Once the transaction has been closed Red Bend will operate inside Harman, but as an independent unit led by the company’s existing management.