Daikin looks to US market with Goodman buy

 
City A.M. Reporter
DAIKIN Industries will buy Goodman Global for $3.8bn (£2.4bn), it said yesterday, gaining greater access to the North American market and making the Japanese company the world’s largest maker of heating, ventilation and air-conditioning (HVAC) systems.

Daikin has long been interested in its Houston, Texas-based rival, but put off takeover talks following Japan’s devastating earthquake and tsunami last year and then later due to uncertainty over the global economy.

The Japanese firm, helped by a strong yen, will pay $3.8bn for Goodman in an acquisition that will allow it to overtake top-ranked Carrier brand maker United Technologies as the world’s top HVAC maker.

Daikin will not turn to equity markets to fund the deal but use loans, its cash reserves and tap a bond issue of about 50bn yen, a company official said earlier yesterday. Reports of the purchase from private equity firm Hellman & Friedman before its announcement caused Daikin shares to fall on worries that the price was too high.

Daikin shares tumbled nearly nine per cent in early trade, before trimming losses to finish 3.5 per cent lower, its biggest daily drop in three weeks.