Johnson Controls' $6 billion HVAC assets attract interest from Bosch, Lennox, and Samsung

HVAC acquisition race: Several industrial giants, including Bosch, Lennox International, and Samsung Electronics, are in contention to acquire heating and ventilation assets valued at over $6 billion from Johnson Controls International. 

Johnson Controls, headquartered in Milwaukee, has been actively working with advisors to offload its residential and light commercial businesses, including a US segment and a 60 per cent stake in an air-conditioning venture with Japan's Hitachi, according to a Reuters report. The discussions are confidential, and additional bidders might enter the fray before any deal materialises, which could take months.

Streamlined operations priority

Johnson Controls issued a statement stressing its focus on streamlining operations to become a comprehensive solutions provider for commercial buildings. The company expressed its focus on exploring strategic alternatives for non-commercial product lines to maximise shareholder value.

When contacted for comment, representatives from Bosch, Lennox, and Samsung did not immediately respond.

Johnson Controls has been pursuing the divestment of its heating and ventilation assets as part of its strategy to shed non-core businesses. Established in 1885, the company manufactures a broad spectrum of appliances and equipment for commercial buildings, along with home comfort appliances. Its offerings include electronic systems for various facilities such as offices, schools, and hospitals, covering areas like ventilation, security, and fire detection.

The shares of Johnson Controls have seen a 12 per cent increase since the beginning of the year, closing at $63.75 on Friday, translating to a market capitalisation of approximately $43 billion.

(With Reuters Inputs)