The all-cash deal will see Samsung buy the Stamford, Conn.-headquartered firm for $112.00 per share. It is the biggest acquisition in Samsung's history, according to the Wall Street Journal.
Samsung said automotive electronics is expected to grow to more than $100 billion by 2025 and has been a strategic priority for the firm.
The deal, which is subject to approval by Harman shareholders and regulators, is expected to be completed in mid-2017, after which Harman will be a standalone Samsung subsidiary.
Oh-Hyun Kwon, Samsung Electronics' vice chairman and CEO, said: “Harman perfectly complements Samsung in terms of technologies, products and solutions, and joining forces is a natural extension of the automotive strategy we have been pursuing for some time.”
“We see substantial long-term growth opportunities in the auto technology market as demand for Samsung’s specialized electronic components and solutions continues to grow,” added Young Sohn, Samsung Electronics president and chief strategy officer.
The announcement comes after a massive recall of Samsung Galaxy Note 7s, which posed a fire risk related to the smartphone's battery. Samsung has also announced a voluntary recall of 2.8 million top-loading washing machines because the top of the machine could detach and cause injury when running a high-speed cycle.
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