Mercedes-AMG has bought Mercedes-A-Class, a company that specializes in luxury vehicles and luxury sports cars.
The Mercedes-AMS brand will become a subsidiary of Mercedes-Kia, the German automaker’s largest unit, while Mercedes-Honda will retain its core Mercedes-Class brand.
The acquisition was announced Monday, and is expected to be completed by the end of the year.
“Mercedes-AMGs world-class heritage of design and innovation is of the utmost importance to us, and we are pleased to confirm the acquisition of Mercedes AMG,” said Mercedes-CFO Karl Brauer in a statement.
“We look forward to working closely with Mercedes- AMG to bring its unique brand to the new company.”
Mercedes-Samedi CEO Robert D. Alsop said in a company statement that the two companies will continue to collaborate, “across the entire spectrum of automotive, technology, and automotive solutions, and to ensure a shared vision for the future of our brand.”
Mercedes’ purchase of Mercedes makes it the largest buyer of luxury cars by a global automaker in history.
The deal was announced at a time when Mercedes is grappling with slowing sales and a series of high-profile safety and emissions scandals.
In April, the company agreed to pay $2.2 billion to settle claims it misled regulators about the impact of its emissions cheating programs on its emissions.
Earlier this month, it was forced to recall more than 200,000 vehicles in the United States and Europe after the government reported the automaker had violated air pollution laws.
Mercedes also has a deal in place with Nissan for an unspecified purchase.