Samsung’s exhibition stand prominently displays the slogan “A new era of mobile agent AI” by South Korean company Samsung Electronics.
Joan Cross | Null Photo | Getty Images
Shares of Samsung SDS rose as much as 21.3% on Wednesday after global private equity firm KKR agreed to invest 1.22 trillion won ($820 million) in a new convertible bond issue from the South Korean IT solutions and logistics provider.
The deal comes as technology companies increase spending on AI infrastructure and digital transformation, and Samsung SDS is positioned to capture surging demand for artificial intelligence services.
Samsung SDS, part of the Samsung Group and an affiliate of Samsung Electronics, said in a statement that KKR will advise on mergers and acquisitions, capital allocation, artificial intelligence offerings and global expansion.
“Through this strategic alliance, we will leverage KKR’s accumulated expertise in global capital markets to proactively explore a wide range of growth opportunities, including M&A,” said Lee Jun-hee, President and CEO of Samsung SDS.
The proceeds will also accelerate Samsung SDS’ investments in AI infrastructure and strengthen its expansion as a full-stack AI solutions provider.
Full-stack AI solution providers build and deliver every part of an AI system, from the basic computers and data storage to the ready-to-use AI tools that companies use to actually run their businesses.
Samsung SDS also provides traditional cloud, digital transformation, and logistics services to a global customer base across industries.
Samsung Electronics shares rose nearly 4% in South Korea on Wednesday, helped by gains in U.S. technology stocks overnight.
“With the growing demand for digital transformation and AI solutions, we have strong confidence in Samsung SDS’ market leadership and growth potential by playing a key role in advancing Korea’s digital capabilities and infrastructure,” said Park Chun-ho, Partner and Head of Korea at KKR.
KKR said the investment will be made primarily from Asia Fund IV and the transaction is expected to close in the second quarter.
—CNBC’s Justina Lee contributed to this report.
