The board of directors at Korean electronics company LG Electronics has approved the acquisition of Israel-based vehicle cybersecurity startup Cybellum.
In announcing the deal on Thursday, LG said it would assume a stake of around 64% in Cybellum, which was valued at $140m. The remaining shares will be acquired soon, at which time the final valuation and total investment amount will be confirmed.
LG called the acquisition “a strategic move that will enhance LG’s cybersecurity capabilities and accelerate its efforts to become an Innovation Partner for Future Mobility.”
Alongside its investment, LG committed to a simple agreement for future equity (SAFE) that will see an additional $20m invested in Cybellum in the fourth quarter of 2021 upon conclusion of the trading process.
Cybellum was founded in 2016 in Tel Aviv by CEO Slava Bronfman and CTO Michael Engstler, both of whom served in the elite Israeli military intelligence group, Unit 81.
“We’re excited about this partnership with LG and the great return we’ve been able to deliver to our stakeholders,” said Bronfman. “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.”
Thirty-five of Cybellum’s 50 employees are based at the company’s research and development center in Tel Aviv. Since its creation, the company has seen investment from RSBG Ventures, Blumberg Capital, and Target Global amid other sources.
Working in partnership with the likes of Jaguar and Nissan, Cybellum provides automotive original equipment manufacturers (OEMs) and suppliers with an agentless solution that can scan embedded software components and detect cyber vulnerabilities. The solution can also remediate risks at scale over a vehicle’s entire life cycle.
“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.”