Samsung reportedly acquired startup Smarthings for $200 million as part of the company's initiative to expand into home security and household appliances.
SmartThings became popular for their smart-home controllers. Both parties were quiet about the price of the acquisition, but sources of Re/code revealed that it cost the South Korean company $200 million.
"I think at a high level, it has always been our vision to go really big," SmartThings founder and CEO Alex Hawkinson told Re/code. "It's just scale and reach all around the world - imagine reaching hundreds of millions of consumers and many more developers," he added.
Hawkinson will continue to run and manage SmartThings, operating independent of Samsung's directions. However, most of its employees and its offices, currently located in San Francisco and Minnesota, will be transferred to Palo Alto, Calif. The transfer will make the offices part of Samsung's Open Innovation Center (OIC).
The OIC unit is led by former AOL and Google content executive David Eun, and is focused on developing software and new ideas and innovation for their services.
SmartThings started as a Kickstarter campaign back in 2012. Their campaign was able to get at least $15 million in funding, with contributions from companies like Grelylock Partners, First Round Capital and Highland Capital. The company is owned by Physical Graph Corp., which also owned Oculus VR before Facebook acquired it for $2 billion.
Samsung's deal with SmartThings is part of their effort to make a name in household appliances and to keep up with the competition. This year, Google has acquired Nest Labs for $3.2 billion. Samsung's partnership with SmartThings will enable the company to penetrate the market by selling locks, lights and other home devices that can be connected to a user's smartphone through apps.
