Samsung Electronics Pursues Acquisition of U.S. Cooling Firm Modin

Samsung Electronics is reportedly in negotiations to acquire Modin Manufacturing, a U.S. company specializing in cooling systems for data centers. This move follows Samsung's acquisition of the German HVAC firm FlaktGroup last year, as the company accelerates its entry into the artificial intelligence (AI) data center cooling market.

On November 12, Bloomberg News cited multiple anonymous sources stating that Samsung and Modin are discussing acquisition terms. The negotiations could conclude within weeks, but no final decision has been made. There is also a possibility that talks could break down or that another bidder may emerge. Both Samsung and Modin declined to comment on the matter.

Based in Wisconsin, Modin supplies heating, ventilation, and air conditioning (HVAC) systems for commercial buildings and industrial machinery. Recently, it has focused on developing cooling systems for AI data centers as a key growth area. Revenue from its data center segment surged 95% in the third quarter compared to the same period last year.

As the performance of AI semiconductors improves, the demand for cooling systems is rapidly increasing due to higher power consumption and heat generation in data centers. In October, Modin restructured its business to focus on thermal management after separating its automotive-related operations.

Modin's market capitalization is approximately $5.6 billion (about 7.5 trillion won). Its stock price fell about 15% after reporting disappointing quarterly results on November 3. However, following news of the acquisition talks on November 12, shares closed at $106.10 on the New York Stock Exchange and surged over 28% in after-hours trading, exceeding $135.

If Samsung successfully acquires Modin, it could expand its business presence in the North American data center cooling market, following its acquisition of FlaktGroup. However, specific details regarding the acquisition price and terms have not been disclosed.