South Korean automaker Hyundai Motor is considering increasing its stake in or acquiring South Korean autonomous driving start-up 42dot. The takeover considerations are seen as a signal of Hyundai’s growing interest in the fast-growing autonomous vehicle market.
A spokesman for 42dot confirmed to tech news outlet TechCrunch that the startup is in talks with Hyundai Motor. However, the terms, including the size of the stake and the valuation of the deal, have not yet been finalized.
Hyundai currently holds a 20.4 percent stake in the three-year-old startup, while 42dot co-founder and CEO Chang-Hyeon Song held a 36.2 percent stake as of December 2021. This emerges from documents from 42dot. The remaining shares are owned by venture capital firms and strategic investors. Interestingly, according to TechCrunch, in addition to his role at 42dot, Song also leads the Transportation-as-a-Service (TaaS) team at Hyundai Motor.
Part of the Group’s strategic transformation
The consideration of investing more heavily in 42dot can be interpreted as a sign that Hyundai Motor is accelerating its efforts to strengthen its autonomous driving technology. This aligns with plans by the South Korean automaker to invest around $79 billion in autonomous driving software technology and electric vehicle businesses by 2030. Hyundai Motor wants to secure a seven percent share of the global market for electric vehicles by 2030. The group has earmarked a good nine billion US dollars for investments in connectivity and software for autonomous driving.
Hyundai Motor is committed to developing advanced technologies. The primary aim is to advance the Group’s strategic transformation into a Smart Mobility Solution Provider. In addition to autonomous driving, Hyundai has already invested in other future technologies, including artificial intelligence (AI), urban air mobility (UAM), smart factories and robotics. In June last year, Hyundai completed the acquisition of robotics company Boston Dynamics.
South Korea wants to be at the top of the world when it comes to new mobility. According to the government, the country should become the market leader in e-mobility and autonomous driving by 2030. According to reports, Hyundai Motor will bear the lion’s share of the billions in investments announced by the industry. A few years ago, the group founded a joint platform for autonomous vehicles with the Irish supplier Aptiv. Their daughter “Motional” was officially presented in August 2020. In early 2021, there were also rumors of a potential partnership between Apple and Hyundai to build self-driving electric cars. The talks were later paused.
Acquisition this month?
So now Hyundai’s takeover plans for 42dot, which, according to TechCrunch, were first reported by the South Korean local newspaper Korean Economic Daily. According to the newspaper, Hyundai approached 42dot in June to acquire the company and is willing to invest the equivalent of at least US$306 million. The planned deal could close as early as this month, the newspaper said.
Founded in 2019 by former Apple, Microsoft and Naver student Song, 42dot has developed AKit, a self-driving software and hardware solution, and TAP, an autonomous mobility and logistics platform, offering a range of services in the areas of ride- hailing, fleet management, on-demand transportation, intelligent logistics and more.
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