Johnson Controls completes York acquisition

MILWAUKEE — Johnson Controls in mid-December 2005 completed its acquisition of HVACR equipment and services supplier York International. Johnson Controls had announced in late August 2005 that it intended to buy York (September 2005, pg. 1).

Effective as of the transaction, the Johnson Controls Board of Directors elected former York CEO and President C. David Myers as a vice president and corporate officer of Johnson Controls. The company also named Myers as president of its building efficiency business.

"The complementary capabilities of the two businesses create an offering that will reshape our industry," Myers said. "Whether it's a single facility or global organization, customers will now have access to unmatched, end-to-end integrated products and services."

For example, a multi-site global company will now have a single source to purchase, install and service mechanical equipment and other integrated systems and services, he said. The result will be faster installations, more efficient operations and a competitive cost structure, according to the company.

Some systems-related priorities include the convergence of Johnson Controls Metasys building management system and York's ISN ConneXsys controls to ensure uninterrupted operations. In addition, organizations will soon see factory-mounted controls from Johnson Controls on select light commercial York equipment to offer packaged rooftops with both N2 and BACNet protocols. Johnson Controls will focus on connectivity for all commercial products that will support integration of protocols from other types of control systems.

"In most cases, the best solution for our customers will be an integrated Johnson Controls/York offering," Myers said. "When that's not the case, we will offer our customers flexibility and address their needs with other solutions."

The acquisition creates a global provider with more than 700 sales and service offices in more than 125 countries in North America, Europe, Asia, the Middle East and Latin America. York will retain its global product brand under "York, A Johnson Controls Co."

York had annual sales of almost $5 billion in 2005. It has become part of the Controls Group of Johnson Controls, which had annual sales of nearly $6 billion. Johnson Controls' fiscal 2005 consolidated sales from continuing operations, including its automotive seating/interiors and battery businesses were expected to be $28 billion.

Johnson Controls previously had said it anticipates more than $275 million of annual synergies resulting from the York purchase. These primarily are related to cost efficiencies and a lower effective tax rate, to be achieved in 2008.

"By joining with York, a market leader with a strong growth outlook, Johnson Controls is staking out a strategic leadership position in the global building environments industry that will offer significant growth potential and synergies," said John M. Barth, chairman and CEO of Johnson Controls. "Bringing together our two organizations will also create the largest building services force in the world, strongly positioning us to capture an increased share of the $130 billion global services market."

Johnson Controls still has not announced what role York's residentially oriented Unitary Products Group would have in the new organization.