LG Electronics acquires Norway's OSO Hotwater to expand global HVAC presence

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LG Electronics acquires Norway's OSO Hotwater to expand global HVAC presence

Published: 30 Jun. 2025, 18:49 Updated: 30 Jun. 2025, 19:07

Audio report: written by reporters, read by AI

A view of OSO Hotwater's booth at the International Trade Fair for Sanitation, Heating and Air 2025, the world's largest air conditioning and heating exhibition held in Frankfurt, Germany, earlier this year [LG ELECTRONICS]

LG Electronics announced the acquisition of OSO Hotwater, a Norwegian manufacturer of premium water heating solutions, marking a major strategic move to expand its global heating, ventilation and air conditioning (HVAC) business. The deal, disclosed on Monday, gives LG a 100 percent stake in OSO, although the acquisition price remains undisclosed. Industry insiders estimate the deal is worth several hundred billion won.

With this acquisition, LG follows in the footsteps of Samsung Electronics, which recently acquired Germany’s FläktGroup, as Korea’s tech giants ramp up competition in the booming HVAC market. The sector is gaining prominence due to the rapid expansion of infrastructure in data centers and semiconductor facilities, driven by AI technologies.

“This acquisition is part of the portfolio enhancement in the HVAC sector, which is a key driving force in business-to-business business,” LG Electronics said.

OSO is a company that produces stainless steel water storage tanks and electric water heaters that store water heated by heat pumps or boilers, which extract heat from the outside air to cool and heat buildings.

Founded in 1932, it has the largest market share in the European stainless steel water storage sector. With 260 employees, last year's sales were 942 million Norwegian Kroner ($93.56 million).

The acquisition is expected to create synergy between LG’s high-efficiency heat pump systems — widely used in Europe to meet demand for decarbonized heating solutions — and OSO’s advanced hot water storage technology.

As demand for heat pumps grows across Europe amid concerns about climate and energy security, a stable hot water supply remains a key challenge that OSO’s products can help address.

"Until now, we’ve sourced water tanks mainly through OEM contracts," said an LG official. "This deal enables us to offer tailored, integrated packages to customers."

LG Electronics' CDU, an liquid cooling solution that directly cools the heat of CPU-GPU chips in data centers [LG ELECTRONICS]

Following Samsung, LG also targets HVAC

The move follows Samsung Electronics’ acquisition of Germany’s leading HVAC firm, the FläktGroup, for approximately 2.4 trillion won last month. With global infrastructure investment surging in sectors like data centers and semiconductor fabs — driven by the rise of AI — demand for HVAC systems is skyrocketing.

The global HVAC market is projected to grow from $266.7 billion this year to $382.7 billion by 2030, at an average annual growth rate of 7.5 percent, according to Grand View Research.

LG Electronics sees this acquisition as a stepping stone to internalize key technologies necessary for expanding into the European market. LG recently established the Energy Solutions (ES) Business Division to accelerate HVAC growth and, in March, announced that it would supply cooling systems to Microsoft's data centers. The company aims to double HVAC sales to 20 trillion won by 2030.

“This acquisition is a key catalyst for LG’s HVAC expansion,” said Lee Jae-sung, head of LG’s ES division. “Combining our expertise with OSO’s will enable us to deliver high-efficiency solutions that elevate LG’s market position.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY PARK HAE-LEE [[email protected]]