Bosch to Buy Johnson Controls-Hitachi AC Assets for $8B

June 24, 2024 : German technology conglomerate Bosch has entered into a definitive agreement to acquire the residential ventilation businesses of Johnson Controls and Hitachi for a substantial sum of $8 billion. This acquisition marks the largest takeover undertaken by the privately held Bosch Group to date.

The acquisition encompasses Johnson Controls’ heating, ventilation, and air conditioning (HVAC) business, which is dedicated to residential and small commercial applications. This strategic move aims to significantly bolster Bosch’s Home Comfort unit, propelling its sales from €5 billion to €9 billion. The deal includes Johnson Controls’ North American ducted business, its residential joint venture with Hitachi, and certain ductless HVAC production sites in Shimizu, Japan.

Bosch anticipates a substantial expansion of the global market for heat pumps, ventilation, and air conditioning systems by approximately 40% by the year 2030. This acquisition positions the company to capitalize on this projected growth and strengthen its market position.

Johnson Controls stands to receive $6.7 billion in cash due to the transaction. The sale includes its North American ducted business and the residential joint venture with Hitachi. The overall transaction, encompassing additional ductless HVAC production sites retained by Hitachi, is valued at $8.1 billion.

The acquisition process was competitive, with several prominent companies, including Lennox International and Samsung Electronics, expressing interest in acquiring the Johnson Controls assets. Ultimately, Bosch emerged as the successful bidder, demonstrating its strategic commitment to the HVAC sector.

The transaction is subject to customary regulatory approvals and is expected to close within a specified timeframe. Upon completion, Bosch will integrate the acquired businesses into its existing operations, aiming to achieve synergies and enhance its market position.

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