Samsung targets AI growth with FläktGroup purchase

Samsung Electronics signed an agreement on May 14 to acquire FläktGroup, Europe’s largest air-conditioning equipment company, for 1.5 billion euros (approximately 2.4 trillion won). The deal marks the first major merger and acquisition (M&A) for Samsung since its 2016 acquisition of Harman, the audio and automotive electronics company.

This acquisition signals Samsung's commitment to entering the fast-growing artificial intelligence (AI) sector. FläktGroup, a 107-year-old company, specializes in centralized air conditioning systems that manage temperature and humidity in data centers and large commercial buildings. The company serves a diverse range of customers, including major tech firms, pharmaceuticals, healthcare, and plant industries, generating annual revenue of over 1 trillion won. With the data center market experiencing a rapid 18% annual growth to handle increasing heat output, Samsung aims to strengthen its market position in this sector through the acquisition.

Under the leadership of Chairman Lee Jae-yong, Samsung faced significant delays in investments and M&A activities due to his near decade-long legal battles related to his succession of management control. Meanwhile, global competitors accelerated strategic partnerships across various industries to dominate future markets. Samsung’s first major M&A in nine years has raised concerns over the lost time in maintaining leadership in core businesses like semiconductors and smartphones, while new industries such as AI, robotics, and autonomous driving remain underdeveloped.

Chairman Lee recently called for a “tough Samsung,” one resilient in the face of crises, and this acquisition could serve as a catalyst for the company’s recovery in innovation and new business opportunities. Going forward, the company must prioritize bold investments and aggressive M&As, focusing not only on short-term profits but on long-term growth.

The government and political leaders must also support businesses by creating swift economic legislation that enables them to invest and grow in new industries, rather than simply offering lip service.