Samsung Acquires FlaktGroup for $1.7 Billion, Eyeing AI Data Center Cooling Market

Samsung Electronics to buy German cooling system maker FlaktGroup for $1.7 billion

Samsung Electronics will acquire FlaktGroup for $1.68 billion. This acquisition aims to meet the cooling demands of data centers. The deal is expected to close this year. Samsung seeks growth in AI chips and other sectors. Investors had hoped for larger deals involving Samsung's chip business. The company is expanding into consumer audio, cooling, heating, medical, and robotics.South Korea's Samsung Electronics on Wednesday said it has agreed to buy FlaktGroup, a German maker of air conditioning and heating systems, for 1.5 billion euros ($1.68 billion) from private equity group Triton. Samsung, through its biggest acquisition in eight years, said it aims to tap demand for data centres for artificial intelligence projects, which require stable cooling. The data centre segment has a high barrier to entry requiring global supply experience and the ability to present optimal designs and solutions, Samsung said in a statement. It expects the FlaktGroup deal to close within this year, it said. Shares in the consumer electronics and semiconductor maker inched up 0.7% largely in line with the benchmark KOSPI. Samsung, led by Chairman Jay Y. Lee, at a shareholder meeting in March said it was looking for deals to drive growth after largely missing out on an AI chip boom. In contrast, compatriot SK Hynix supplies advanced high bandwidth memory (HBM) chips to AI leader Nvidia. Investors expecting bigger deals involving Samsung's cash cow chip business might feel underwhelmed by the FlaktGroup announcement, analysts said. "This acquisition is more about reinforcing its consumer electronics and home appliance businesses, so it is not the game-changing deal the market had been hoping for," said Greg Roh, head of research at Hyundai Motor Securities. Samsung's appliance business also makes commercial cooling and heating systems. "It feels like the company is playing it safe rather than making bold bets," Roh said. Samsung has shunned major acquisitions since its $8 billion purchase of car electronics maker Harman International Industries in 2017. This month, Harman agreed to buy the audio business of U.S. firm Masimo for $350 million. Consumer audio is a new growth engine, Samsung has said, alongside cooling and heating systems, medical and robotics. In December, Samsung became the largest shareholder of South Korea's Rainbow Robotics with the purchase of an additional 267 billion won ($189.03 million) stake. ($1 = 0.8937 euros) ($1 = 1,412.5000 won)

Samsung's $1.7 Billion Cooling Spree - Buys FläktGroup To Target Data Center Boom - Samsung Electronics Co (OTC:SSNLF)

On Wednesday, Samsung Electronics Co SSNLF disclosed a 1.5 billion euros ($1.7 billion) deal to purchase all shares of FläktGroup, a major worldwide supplier of HVAC systems, from the European investment company Triton. Based in Herne, Germany, FläktGroup offers over a century of HVAC tech and design expertise, providing tailored, reliable, and efficient systems for diverse facilities, such as data centers (stable cooling), museums/libraries (sensitive artifacts), airports (high traffic), and hospitals (critical environmental control). FläktGroup has strong data center customer satisfaction and revenue growth (past 3 years) due to product performance, reliability, and service, offering leading liquid/air cooling that helps reduce energy consumption and carbon footprint. The transaction is expected to close in 2025. Samsung expects the acquisition to capitalize on sustained data center demand driven by the growth of generative AI, robotics, autonomous driving, XR, and other advanced technologies. Furthermore, the integration of Samsung's b.IoT building control solution and FläktGroup's FläktEdge HVAC control system is projected to create a comprehensive suite for HVAC and building energy management, which the company anticipates will lead to an expansion of its service and maintenance business. Notably, Market research suggests the applied HVAC market will grow from $61 billion in 2024 to $99 billion by 2030 (8% annual growth), with data center cooling growing even faster at 18% annually. Yesterday, Samsung launched the Galaxy S25 Edge, a 5.8 mm-thin, 163-gram smartphone, just four months after unveiling the rest of the S25 series. In April, the company reported first-quarter revenue growth of 10% year-on-year to 79.1 trillion Korean won ($55.5 billion). Read Next: Advanced Micro Devices Drops Samsung, Shifts Chip Orders To Taiwan Semiconductor Photo by Sybillla via Shutterstock SSNLFSamsung Electronics Co Ltd$42.489.38%Stock Score Locked: Want to See it? Benzinga Rankings give you vital metrics on any stock - anytime. Reveal Full ScoreEdge RankingsMomentum-Growth-Quality-Value-Price TrendShortMediumLongOverviewGot Questions? AskWhich data center firms will thrive post-acquisition?How will Samsung's HVAC systems reshape the market?What impact on energy stocks could HVAC growth bring?Are there emerging tech companies benefiting from this?Which construction firms could gain from HVAC demand?How will FläktGroup's technology enhance competitor offerings?Which renewable energy companies might see growth?Could telecom firms benefit from data center expansion?What are the investment prospects in HVAC startups?How might this affect AI-related businesses in the future?Powered By This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors. Market News and Data brought to you by Benzinga APIs

Samsung to buy German cooling system maker FlaktGroup for $1.7 billion

SEOUL (Reuters) - Samsung Electronics said on Wednesday it had agreed to buy Germany's FlaktGroup for 1.5 billion euros ($1.68 billion) as it looks to meet growing demand for cooling of data centres used for artificial intelligence projects. In the South Korean company's biggest acquisition in eight years, it will purchase the air conditioning and heating systems maker from private equity group Triton. The data centre segment has a high barrier to entry requiring global supply experience and the ability to present optimal designs and solutions, Samsung said in a statement. It expects the FlaktGroup deal to close within this year, it said. Samsung, led by Chairman Jay Y. Lee, said at a shareholder meeting in March that it was looking for "meaningful" deals this year to drive growth after lagging behind rivals in tapping the AI chip boom led by Nvidia. Samsung added it aimed to pursue acquisitions in the chip industry. Investors expecting bigger deals involving Samsung's cash-cow chip business might feel underwhelmed by the FlaktGroup announcement, analysts said. "This acquisition is more about reinforcing its consumer electronics and home appliance businesses, so it is not the game-changing deal the market had been hoping for," said Greg Roh, head of research at Hyundai Motor Securities. Samsung's appliance business also makes commercial cooling and heating systems. "It feels like the company is playing it safe rather than making bold bets," Roh said. Shares in the consumer electronics and semiconductor maker inched up 0.7% largely in line with the benchmark KOSPI. Samsung has shunned major acquisitions since its $8 billion purchase of car electronics maker Harman International Industries in 2017. This month, Harman agreed to buy the audio business of U.S. firm Masimo for $350 million. Consumer audio is a new growth engine, Samsung has said, alongside cooling and heating systems, medical and robotics. In December, Samsung became the largest shareholder of South Korea's Rainbow Robotics with the purchase of an additional 267 billion won ($189.03 million) stake. Samsung last year formed a joint venture with Lennox in the heating, ventilation and air conditioning (HVAC) sector, and was among the bidders for Johnson Controls International HVAC assets that were bought by rival Robert Bosch for $8 billion last year. (Reporting by Hyunjoo Jin, Heekyong Yang and Jack Kim; Editing by Ed Davies, Christopher Cushing and Jamie Freed)