LG to acquire vehicle cybersecurity risk assessment solution provider Cybellum

LG Electronics (LG) Board of Directors approved the acquisition of Cybellum, a leading vehicle cybersecurity risk assessment solution provider, in September 2021. This deal allows LG to assume an approximate 64% stake in the technology company valued at USD $140 million. This is a strategic move that will enhance LG’s cybersecurity capabilities and accelerate its efforts to become an Innovation Partner for Future Mobility.

As for the remaining shares, it will be acquired in the near future with the final valuation and total investment amount to be confirmed at that time. On top of this initial investment, LG committed to a simple agreement for future equity (SAFE) to invest an additional USD $20 million in Cybellum upon conclusion of the trading process in the fourth quarter.

Cybellum is a leading vehicle cybersecurity company founded in 2016 in Tel Aviv. The company has about 50 employees and they are currently collaborating with key industry players, successfully delivering its products to vehicle manufacturers and suppliers worldwide. Beside Israel, Cybellum has operations in Japan, Germany and North America. Cybellum will remain and independent entity and brand, continuing to grow and support its customers and partners with the same commitment level and standards that Cybellum customers have become accustomed to.

The types and numbers of cybersecurity threats are on the rise around the world. With the global automobile industry transitioning into the connected car era, the area on vehicle cybersecurity is getting more important making secure connectivity essential for the future of connected cars. As cars of the future evolve into organically connected systems with complex interrelationships between their various components, vehicle cybersecurity will only become more important over time in the very near future.

Cybellum will enable LG to preemptively secure a sustainable growth engine in the rapidly growing automotive cybersecurity industry and deliver more value in key areas such as parts design, development and operation by optimising software security.

Cyber Digital Twins Platform is one of Cybellum’s most advanced solutions to protect vehicles from cybersecurity threats. This platform creates a detailed representation of a vehicle’s software components without accessing the source code and automatically exposes any risks that could potentially be exploited. The platform relies on real-time threat intelligence feed to check for vulnerabilities and delivers a full assessment of those vulnerabilities as well as providing recommended solutions.

The acquisition of Cybellum is the first for LG in Israel and in the cybersecurity domain. This investment underscores the importance and significance of this growing category, it’s also a key part of LG’s strategy to strengthen its business portfolio through strategic acquisitions, alliances and partnerships, with a strong focus on its vehicle component business.

In August 2018, LG acquired Austria’s ZKW Group, a leading player in the automotive lighting market. In July, LG launched a joint venture with Magna International, the world’s third largest auto supplier, to create LG Magna e-Powertrain, boosting the competitiveness and future growth potential of both partners.

“We’re excited about this partnership with LG and the great return we’ve been able to deliver to our stakeholders,” said Slava Bronfman, CEO of Cybellum. “Cybellum has developed the most comprehensive product security management offering in the industry and joining forces with LG will enable us to further accelerate the realization of our vision. We expect to grow significantly in the near future.”

“It’s no secret the critical role software plays in the automotive industry and with it comes the need for effective cybersecurity solutions,” said Dr. Kim Jin-yong, president of the LG Electronics Vehicle component Solutions Company. “This latest deal will further strengthen LG’s solid foundation in cybersecurity, enabling us to be even more prepared for the era of connected cars.”

LG’s VS (Vehicle Component Solutions) Company is founded in 2013, they have recorded sales of USD $5.18 billion in 2020, a 6.1% increase over 2019. Through its investment in vehicle cybersecurity, LG is committing to increasing the competitiveness of its infotainment systems, electric vehicle powertrains and vehicle lighting capabilities, the three pillars of the automotive component industry.

* Information courtesy of LG Electronics and APRW *

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