Daikin Industries, Ltd. (Daikin) passed a resolution today at its Board of Directors meeting to acquire Goodman Global Group, Inc. (Goodman). Daikin, Goodman, and Goodman's major shareholder, Hellman & Friedman LLC (H&F), signed a definitive agreement today regarding the acquisition. Daikin, a leader in the heating, ventilating and air-conditioning (HVAC) industry headquartered in Osaka, Japan, is represented by its Chairman and CEO, Noriyuki Inoue. Goodman, the leading manufacturer and distributor in the U.S. residential unitary HVAC (for air-conditioning the entire house) sector headquartered in Houston, Texas, is represented by its President and CEO, David L. Swift. H&F, a private equity investment firm headquartered in San Francisco, California, is represented by its Chairman, Brian M. Powers.

In this acquisition, Daikin will purchase 100% of Goodman's stock and the total acquisition value is 3.7 billion US dollars. The transaction, pending regulatory approval, is expected to be completed during the fourth quarter of 2012.

Goodman has a significant presence in the ducted-style residential unitary HVAC segment in North America, a segment where Daikin has little offerings. Goodman generates strong financial performance through its low cost US manufacturing operations and extensive network of over 900 distribution points, of which 192 are company operated.  

Daikin is a comprehensive global HVAC manufacturer offering extensive products, including ductless air-conditioning and heat pump systems for residential and commercial applications as well as large-sized HVAC systems for buildings and factories. Through this acquisition, Daikin will fully enter the ducted-style air-conditioning market for residential and commercial applications in North America. Daikin's sales are expected to grow substantially with an outstanding and complementary product portfolio covering not only ducted and ductless air-conditioning systems but also furnace and heat-pump systems in the world's largest HVAC market. Daikin is a market leader delivering high technology, environmentally-friendly and energy-saving solutions to global HVAC customers.  

Noriyuki Inoue, Chairman and CEO of Daikin said, "Goodman is the best partner for Daikin in North America as we aim to become the leading global HVAC manufacturer.  North America is the largest global HVAC market and most systems in this market are ducted-style, a segment where we have little presence. Goodman and Daikin can enjoy a complementary relationship by having more channels in the market to offer Goodman's market leading ducted products and Daikin's existing products. Daikin will also capitalize on Goodman's lean management know-how to help us improve the earning power of the entire Daikin Group and expand our business in emerging and high volume markets globally."

"Goodman will allow us to serve a broader base of North American customers along with McQuay International (headquartered in Minneapolis, MN), which provides solutions for medium to large HVAC customers, and Daikin AC (Americas), Inc. (headquartered in Dallas, TX), which provides ductless HVAC solutions. Together, Daikin will gain the position of a very competitive North American manufacturer with industry leading energy-saving products and solutions ranging from residential to large building systems."

David L. Swift, President and CEO of Goodman said, "This is an opportunity for Goodman to grow globally as well as in the North American market by leveraging Daikin Group's technical expertise, environmental technologies, and North American commercial expertise. With complementary core businesses, we are in a very competitive position to grow all segments of Goodman's and Daikin's business. We look forward to a successful future as a part of a winning team and are enthusiastic about creating more opportunities to excel."