Samsung steps up acquisition drive, adds German HVAC firm to portfolio

FlaktGroup's Liquid-DENCO coolant distribution unit / Captured from FlaktGroup

Samsung Electronics is accelerating its acquisition drive across its portfolio, adding Europe’s largest air technology company, FlaktGroup, to its holdings.

The company said Wednesday it signed a deal to take over a 100 percent stake in the Germany-based heating, ventilation and air conditioning (HVAC) company for 1.5 billion euros ($1.68 billion) from European private equity firm Triton.

FlaktGroup was established in 1918 and stands as an energy-efficient air solution provider for a wide range of facilities, including data centers, airports, museums and commercial buildings.

FlaktGroup has seen noteworthy growth in the global data center cooling market, with its energy-saving technologies and coolant distribution units gaining strong traction among large data center clients whose priority is achieving low-carbon and eco-friendly operations.

Beyond data centers, FlaktGroup also serves more than 60 major global clients across the pharmaceutical, health care, food and beverage and plant industries.

Samsung Electronics said it plans to finish the transaction by the end of this year.

Seen above is Samsung Electronics' office in Seocho District, Seoul, on April 30. / Yonhap

The deal came amid a promising outlook for the global HVAC market, particularly in central air conditioning for large facilities.

Samsung Electronics is betting that the global central air conditioning market will grow to $99 billion in 2030 from $61 billion in 2024, achieving an 8 percent compound annual growth rate.

The data center sector is expected to reach $44.1 billion by 2030, growing at an average of 18 percent annually, based on the robust growth outlook for generative artificial intelligence (AI) services.

Samsung Electronics plans to proactively invest in the HVAC business as a new growth engine. Through the takeover, the company aims to combine its building automation solutions with FlaktGroup’s HVAC control systems, paving the way for an expanded portfolio of service and maintenance businesses.

The acquisition is the largest for Samsung Electronics since its takeover of audio giant Harman International for $8 billion in 2016.

It is also the latest move in the tech giant’s recent string of M&A campaigns, following its acquisition of firms in future industries such as Rainbow Robotics, Oxford Semantic Technologies in the area of AI, Sonio in medical technology and Masimo’s audio division.

Against this backdrop, the acquisition of FlaktGroup is seen as a shift in strategy from internalizing technological capabilities to actively acquiring key technologies essential for future growth.

The latest deal also draws attention as it focuses on HVAC business, particularly the cooling sector.

The cooling sector was once considered peripheral in the IT industry, but is now emerging as a core pillar of AI infrastructure. Amid rising demand for data centers, the cooling business is now essential for power efficiency, thermal control, eco-friendly design and advanced operating systems.

Samsung Electronics’ rival, LG Electronics, already considers HVAC a key business area. LG Electronics recently began construction of a new HVAC production plant in Alabama and is accelerating its expansion in Southeast Asia and Europe. In May 2024, Samsung Electronics also formed a joint venture with Lennox International to strengthen its HVAC presence in North America.