Carrier to buy Viessmann unit for US$13.2bil

Carrier said it is paying 80% of the purchase price in cash and 20% in stock for Viessmann’s Climate Solutions unit. — Bloomberg

NEW YORK: Carrier Global Corp, the US maker of air conditioners, agreed to acquire most of the German family-owned manufacturing company Viessmann for €12bil (US$13.2bil or RM58.9bil) to bolster its heating and cooling operations.

The US firm is paying 80% of the purchase price in cash and 20% in stock for Viessmann’s Climate Solutions unit, according to a statement on Tuesday.

The unit accounts for 85% of Viessmann’s revenue.

“The acquisition of Viessmann Climate Solutions is a game-changing opportunity,” Carrier chairman and chief executive officer David Gitlin said in the statement.

“Climate change, sustainability requirements and geopolitical factors are driving an unprecedented energy transition in Europe.”

Carrier’s shares fell 7.3% on April 24 in New York when news of the potential deal came out.

The shares have gained 2.6% this year, valuing the Florida-based company at about US$35bil (RM156.2bil).

Carrier’s stock fell about 4% after the close of regular trading following the company’s announcement.

The acquisition is part of a broader transformation at Carrier, which said it is also exiting its fire and security operations. The firm is forging its own path as a standalone company after separating in 2020 from United Technologies Corp, which also split with the Otis elevator business, merged with Raytheon and was renamed Raytheon Technologies Corp.

Viessmann, founded more than a century ago by former factory worker Johann Viessmann, makes heat pumps, boilers and heating systems. It’s now run by the fourth generation of the Viessmann family, according to its website.

Outside of its core climate solutions business, which provides heating, cooling, ventilation, energy generation and energy storage products. The firm also has a small refrigeration business.

The takeover brings a welcome boost to German dealmaking activity. The value of mergers and acquisitions in the country is down about 55% this year to US$9.1bil (RM41bil), according to data compiled by Bloomberg.

It also marks a rare example of the purchase of a so-called Mittelstand company, the small and medium-sizes companies that are the backbone of the German economy. — Bloomberg