Johnson Controls, Hitachi and Hitachi Appliances have entered into a definitive deal for their global HVAC joint venture at the ongoing World Economic Forum in Davos, Switzerland.

The new joint venture will allow both companies to deliver the most diverse technology portfolio in the heating, ventilation, air conditioning and refrigeration (HVAC) industry, said a statement.

Through the deal, Johnson Controls will obtain a 60 per cent ownership stake in Hitachi Appliances’ more than 300 billion Japanese yen ($2.5 billion) sales global air conditioning business, excluding sales and service operations in Japan, it said.

The venture will bring customers a full range of air conditioning products, including world-class variable refrigerant flow (VRF) technology, leading-edge inverter technology based room air conditioners and absorption chillers – on top of existing Johnson Controls products that meet global customer demands.

It aims at building on both organisations’ technology, research and development leadership, as well as their expanding marketing channels.

The transaction is expected to close later this year, subject to regulatory approvals and satisfaction of other customary conditions.

Alex Molinaroli, chair and chief executive officer, Johnson Controls, said: “For Johnson Controls, this partnership reflects our strategic commitment to our buildings business as a growth platform.

“The joint venture will propel us forward with superior products, enabling Johnson Controls to deliver the most diverse technology portfolio in the industry to meet customer demands across the changing global marketplace.”

The joint venture management team will be led by Franz Cerwinka, chief executive officer, who has been with Johnson Controls for nearly 20 years.

Hiroaki Nakanishi, chairman and CEO of Hitachi, said: “The worldwide HVAC market is continuing to grow steadily, and the demand for energy efficient air conditioning systems with state-of-the-art technologies is expanding.

“As air conditioning systems are a key building block for building solutions, we believe this partnership will allow Hitachi and Johnson Controls to deliver the best solutions for our customers. Furthermore, in addition to air conditioning systems, we will be able to provide other building solutions that will enhance efficiencies throughout buildings, as well as surrounding areas.” - TradeArabia News Service