Danfoss acquires Eaton's Hydraulics business

Danfoss acquires Eaton's Hydraulics for USD 3.3 billion (approximately EUR 3.0 billion)

Danfoss, which operates in heating, cooling, motor control systems and power solutions, acquired Eaton's Hydraulics as of January 2020. The acquisition, carried out in line with Danfoss's strategy to strengthen its core business areas and increase customer value, was completed for USD 3.3 billion (approximately EUR 3.0 billion). Danfoss President and CEO Kim Fausing commented on the acquisition: "With this acquisition, we have taken an important and transformational step towards establishing ourselves as a global leader in mobile and industrial hydraulics. We see this as an opportunity where we can combine our complementary portfolios and geographic footprints. Eaton Hydraulics, highly respected in the global sector, is known for its dedicated workforce and strong brands. When the knowledge and experience of both companies come together, our customers will be able to continue their operations with a single partner for unparalleled expertise. With this agreement signed to maintain our position as a strong technology partner, we continue to invest in our core hydraulic business operations and digital solutions." Eaton Hydraulics CEO and Board Chairman Craig Arnold stated: "We believe that Eaton's Hydraulics will benefit greatly from becoming part of a company with hydraulics at its foundation. Once this agreement is finalized, it will bring together two capable teams with comprehensive knowledge and expertise in hydraulics.

Eaton's hydraulic team will join the world leader in mobile and industrial hydraulics, and as a result, we will provide our customers and distributors with a broad technology and hydraulic solutions portfolio."

Both companies share numerous corporate similarities, including culture and customer base, as well as R&D and quality focus. Both operations have complementary geographic footprints worldwide, and following the merger, a broader global reach will be possible. This acquisition agreement will also enable Danfoss to enter the industrial hydraulics market in which Eaton Hydraulics operates. Eaton Hydraulics supplies its products to customers in markets such as agriculture, construction and industrial market segments. Danfoss's existing business segment will be transferred to Danfoss Energy Solutions, and this business segment will bring approximately 11,000 employees and USD 2.2 billion (EUR 2.0 billion) in 2019 sales, doubling the hydraulics business volume. Danfoss currently has approximately 28,000 employees and USD 7.9 billion (EUR 6.3 billion) in 2019 sales. With this agreement, Danfoss will achieve one-third growth. Danfoss Energy Solutions President Eric Alström commented on the matter: "Hydraulics lies at the foundation of our business, and we have been strengthening our energy solutions segment for years through customer focus and substantial investments in technology leadership. I believe that the fully-fledged hydraulics player that will emerge from the merger of these two companies, with its dedication to innovation, broad product range, high-performance distribution channels and extensive geographic reach, will benefit our customers." The company aims to complete all conditions of the acquisition by year-end.