Samsung to invest $170 mil. for HVAC manufacturing facility in Gwangju

Samsung Electronics will invest 240 billion won ($170 million) to build heating, ventilation and air conditioning (HVAC) equipment manufacturing facility in Gwangju, under the goal of having the region as its manufacturing hub for data center cooling solutions.

Samsung Electronics, FlaktGroup Korea and Jeonnam-Gwangju Special Metropolitan City held a signing ceremony for the investment in Gwangju. Jeonnam-Gwangju Mayor Min Hyung-bae, Samsung Electronics Head of Digital Appliances Business Kim Cheol-gi and FlaktGroup Korea Head Sean Lim attended the ceremony.

Under the investment deal, Samsung Electronics will set up FlaktGroup’s HVAC equipment manufacturing facility on a 21,800-square-meter site at Samsung’s existing plant in the city.

The new facility will begin manufacturing FlaktGroup’s coolant distribution units (CDUs) and other HVAC equipment in 2028. CDUs are essential for liquid cooling systems for data centers.

This marks the company’s first large-scale investment in new production facilities since the establishment of its Gwangju plant, then known as Gwangju Electronics, back in 1989.

Samsung’s Gwangju plant manufactures its Bespoke brand refrigerators, washers, dryers and air conditioners, while also serving as a key hub for transferring advanced manufacturing technologies to the company’s overseas production subsidiaries.

Samsung said it plans to develop the Gwangju plant into a global production hub encompassing artificial intelligence (AI)-powered home appliances and HVAC products by leveraging its existing manufacturing infrastructure and capabilities.

FlaktGroup is one of Europe’s largest HVAC companies, specializing in central air conditioning and precision cooling solutions. It develops and manufactures central HVAC equipment for data centers, industrial facilities and commercial buildings such as hotels, airports and museums. Samsung Electronics completed its acquisition of FlaktGroup in November last year for about $1.7 billion.

The new facility will be FlaktGroup’s 15th global manufacturing line, and will focus on CDUs and other products tailored for AI data centers.

A CDU pumps and manages cooling liquid between a chiller and cold plates that directly cool heat-generating chips such as graphics processing units and central processing units.

The facility will produce a range of HVAC equipment, including FlaktGroup’s flagship air handling units (AHUs), fan wall units (FWUs) and computer room air handlers (CRAHs).

AHUs use coolants to cool air and maintain comfortable indoor air quality in data centers and large commercial buildings. FWUs are wall-mounted air circulation systems and CRAHs provide precise air control to help maintain optimal operating conditions for equipment in server rooms.

“Samsung Electronics will promptly expand its HVAC business as its key future growth driver and become a leading player in the global market,” Kim said. “The new production line in Gwangju will serve as an important foundation for strengthening our differentiated competitiveness in the HVAC business.”