Carrier, the US heating specialist, plans to buy Germany’s Viessmann Climate Solutions in a €12 billion ($13.27 billion) deal. With the acquisition, Viessmann’s heat pump business falls into the hands of one of the leading market players in the United States, as Carrier aims to expand its coverage in the fast-growing European heat pump market.
Carrier aims to establish its position as a leading manufacturer of residential and commercial heat pumps in North America and Europe through the acquisition. Carrier Chairman and CEO David Gitlin said, “Viessmann Climate Solutions is uniquely positioned to capitalize on this opportunity with its top brand, highly diversified distribution channel and innovative product offering.” The deal is expected to be completed by the end of 2023.
Viessmann’s Climate Solutions segment purchased by Carrier consists of more than 70% heat pumps and related accessories as well as solar energy, energy storage and related services. Carrier believes the combination of the two companies will create a business with combined revenue of more than $17 billion and approximately 45,000 employees.
According to the terms of the agreement, Carrier will buy Viessmann Climate Solutions for 12 billion euros, of which 80% in cash and 20% of Carrier’s common shares will be delivered to Viessmann Family Holdings. The operator expects to finance the cash portion of the consideration by combining cash and newly committed financing. Viessmann CEO Max Viessmann will also join Carrier’s board.
The companies agreed on long-term guarantees, and functional redundancies were ruled out over the next three years. The Viessmann Group will also remain the owner of its traditional brand, and most of the profits from the sale will be invested back into the company.
German Federal Economy Minister Robert Habeck reacted to the announcement, stating that “The planned sale of the Viessmann division shows that climate protection technologies are the technologies of the future… It is important that the benefits of our energy policy and the profits that accrue from it continue to benefit Germany as a business location. We are paying attention to that.”