Hitachi completes air conditioning joint venture restructuring

Hitachi Ltd. (TSE: 6501) announced it has completed the capital reorganization of its air conditioning joint venture, transferring its 40% stake in Johnson Controls-Hitachi Air Conditioning Holding to Robert Bosch GmbH for approximately $1.46 billion.

The transaction, originally agreed upon in July 2024, also included Hitachi Global Life Solutions' acquisition of the Shimizu Factory in Japan, which served as the joint venture's development and production base for commercial air conditioning equipment.

Under the new structure, Hitachi GLS will expand globally through a brand license agreement with Bosch Home Comfort Group, utilizing Bosch's distribution network in Europe, the United States and Asia. The companies plan to incorporate Hitachi's Lumada digital solutions into air conditioning products.

Hitachi expects to record approximately ¥154 billion in business reorganization income in its consolidated financial statements for the fiscal year ending March 2026. The company stated it will use proceeds for growth investments and shareholder returns.

The Shimizu Factory acquisition allows Hitachi GLS to integrate development, manufacturing, sales and maintenance services for commercial air conditioning in Japan. The facility will focus on developing products for green buildings, data centers and industrial applications including biopharmaceutical and semiconductor manufacturing facilities.

Bosch now owns 100% of the joint venture after acquiring Johnson Controls International's 60% stake alongside Hitachi's portion. The Tochigi Factory, acquired by Bosch in the transaction, will continue producing residential air conditioning products for the Japanese market under the "Shirokumakun" brand, while Hitachi GLS maintains responsibility for sales and aftermarket services.

The reorganization aligns with Hitachi's "Inspire 2027" management plan, which targets expansion in data centers through its Strategic Social Innovation Business unit.

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