Bosch seals $8bn deal to acquire Johnson Controls HVAC business
STUTTGART (Germany), July 30, 2024
Leading German multinational engineering company Bosch has announced that it has entered into a $8 billion deal with Johnson Controls, a leading player in the smart and sustainable buildings sector, to acquire its global HVAC (heating, ventilation, air-conditioning) solutions business for residential and light commercial buildings.
Also as part of the transaction, Bosch aims to buy the Johnson Controls-Hitachi Air Conditioning (JCH) joint venture, including Hitachi’s 40% stake, said the German group in a statement.
Bosch pointed out that the strategic move comes following the go-ahead from its shareholders and supervisory board.
Binding agreements on the acquisitions were signed by the parties and the acquisition is expected to be closed in approximately 12 months, it stated.
On the deal, Bosch Chairman Stefan Hartung said: "As the biggest acquisition in Bosch history, this is an important milestone in the systematic implementation of our strategy for 2030. We are dynamically pushing ahead with the strong development of Bosch, and will achieve a globally leading position in the promising HVAC market with this acquisition."
For its Energy and Building Technology business sector, it plans to take over the global HVAC solutions business for residential and light commercial buildings from Johnson Controls.
Together with JCH, the businesses Bosch intends to acquire generated sales revenue totaling roughly 4 billion euros in 2023, and employ some 12,000 people worldwide.
The transaction includes 16 manufacturing sites and 12 engineering locations in more than 30 countries, said the top official.
The product portfolio covers the entire spectrum of HVAC solutions for residential and light commercial buildings, and includes well-known brands such as York and Coleman in the US and Hitachi in Asia, for which Bosch will be granted a long-term license.
"In taking this step, moreover, we will strengthen our presence in the US and Asia and achieve a better balance among our business sectors. This is also part of our strategy. In this way, we will open up further growth opportunities and put the company as a whole on a firmer footing," he added.
Bosch Deputy Chairman Christian said: "With this acquisition, Bosch will accelerate its growth and nearly double its sales revenue in the HVAC market to roughly 9 billion euros. Together with our future colleagues, we want to seize the huge opportunities offered by the market for the further growth of this new unit."
The acquired businesses will become part of the Bosch core business - and this will benefit customers, installation partners, and associates, he stated.
"We have proved several times in the past that we can successfully integrate brands, take them forward through investments, and strengthen them," he added.
The acquisition is timely as the global HVAC market is set for 40% growth by 2030, driven by technological progress, the fight against climate change, and new regulations.
Johnson Controls CEO George Oliver said: "Our leading residential and light commercial business and its world-class team perfectly complement the Bosch portfolio. We are confident that under Bosch’s leadership the business will continue to excel and deliver innovative products and service to its customers. We look forward to seeing their continued success."
Jun Abe, the Executive Vice President at Hitachi, said: "The new partnership with Bosch to establish a global air-conditioning business is an important step. The market is dynamic, and is flourishing."
"I firmly believe that a global supplier such as Bosch, with its strong European presence and many years of experience in the heating business, is the optimum partner for further expanding the global air-conditioning business of the longstanding Hitachi brand," he added.-TradeArabia News Service
