Irish manufacturer Johnson Controls International (JCI) on July 23 announced it has reached a definitive agreement to sell its residential and light-commercial HVAC business in an all-cash transaction to the Bosch Group, a German manufacturer.
The transaction includes the North America ducted business and global residential joint venture with Hitachi, of which JCI owns 60% and Hitachi owns 40%. The total transaction is valued at $8.1 billion (€7.5 billion), and JCI’s portion of the consideration is approximately $6.7 billion (€6.2 billion). The transaction is expected to close in approximately 12 months, subject to required regulatory approvals and other customary closing conditions.
Following the close of the transaction, JCI’s portfolio will be substantially simplified to align with the company’s objective to be “a pure-play provider of comprehensive solutions for commercial buildings,” including data centers, JCI said.
“We are pleased to have reached this pivotal milestone, which accelerates our transformation and positions Johnson Controls as a simpler, higher-growth company,” said JCI’s Chairman and CEO George Oliver. This includes “exposure to rapidly accelerating demand in the data center market and other key macro-economic tailwinds,” he added.
JCI’s digital offerings are designed to improve commercial building efficiency and reduce operational costs through its OpenBlue digital platform. Its U.S. subsidiary Frick is a manufacturer of ammonia (R717)-based industrial refrigeration systems.
Last month, JCI said it is ready to supply its commercial propane chillers and heat pumps to the Australian market.
Last year JCI announced an update of its Frick Rooftop Freezer (RTF) product line with its new Frick Freezer Penthouse Evaporator-Retrofit, model FPHE-R, designed to improve reliability, ease of installation and maintenance accessibility for industrial refrigeration applications. The FPHE-R design is configured for ammonia, but other types of low or ultra-low GWP refrigerants, such as CO2 (R744) or water (R718), can also be used in the units with a different evaporator design, said JCI.
“Johnson Controls’ Residential & Light Commercial business has a consistent track record of excellence within the HVAC industry,” said Christian Fischer, the Deputy Chairman of the Board of Management of Robert Bosch GmbH. “The acquired entities will strengthen Bosch’s Home Comfort Group in an extremely attractive segment and will become part of the Bosch core business.”
The acquisition will not affect Bosch’s heat pump business, which includes propane (R290) heat pumps, the company told NaturalRefrigerants.com. Last year Bosch announced plans to invest €1 billion (US$1.1 billion) in its European heat pump production by 2030. Part of this investment includes producing the indoor units of its new R290-based residential heat pump at its facility in Eibelshausen, Germany. “The range of propane heat pumps from the Bosch Home Comfort Group is being continuously expanded,” said Bosch.
This article was updated on July 25 to include comments from Bosch.
“We are pleased to have reached this pivotal milestone, which accelerates our transformation and positions Johnson Controls as a simpler, higher-growth company.”
George Oliver, Chairman and CEO, Johnson Controls International
