Heat Meets Steel: LG Acquires Norway’s OSO to Supercharge HVAC Growth in Europe

Image Source : The Korea Herald

LG Electronics has announced the acquisition of OSO Hotwater, a leading Norwegian manufacturer of premium water heating solutions, in a strategic move to expand its heating, ventilation, and air conditioning (HVAC) footprint across Europe. The deal gives LG a 100 percent stake in OSO and is expected to create powerful synergies between LG’s high-efficiency heat pump systems and OSO’s stainless steel hot water storage technologies.

Here’s a comprehensive breakdown of the acquisition and its broader implications.

Key Developments and Strategic Intent

- OSO, founded in 1932, is a market leader in stainless steel water storage tanks and electric water heaters tailored for heat pump and boiler systems
- The acquisition strengthens LG’s B2B portfolio and supports its ambition to become a top-tier global HVAC player
- OSO’s manufacturing bases in Norway and Sweden will continue operations independently while integrating with LG’s global supply chain
- The deal enables LG to offer integrated HVAC and water heating packages, enhancing its competitiveness in the USD 15 billion European heating market

Market Context and Growth Drivers

- Europe is witnessing a surge in demand for air-to-water heat pump (AWHP) systems due to climate policies and energy security concerns
- According to BRG Building Solutions, the European heat pump market is expected to double by 2030, with annual unit sales rising from 1.2 million in 2024 to 2.4 million
- OSO’s stainless steel tanks offer superior hygiene, corrosion resistance, and energy efficiency—key attributes for modern heat pump systems
- LG plans to leverage OSO’s automated manufacturing and product expertise to develop all-in-one HVAC solutions for residential and commercial applications

Competitive Landscape and Strategic Positioning

- The acquisition follows Samsung Electronics’ recent purchase of Germany’s FläktGroup, signaling intensifying competition among Korean tech giants in the HVAC space
- LG’s Energy Solutions division, launched in late 2024, is driving growth through a build-borrow-buy strategy, with this acquisition falling under the buy pillar
- The deal also supports LG’s broader clean tech ambitions, including solutions for data centers and semiconductor facilities requiring advanced thermal management

As LG integrates OSO’s capabilities into its HVAC ecosystem, the acquisition marks a pivotal step in redefining how heating and hot water solutions are delivered across Europe—combining Nordic engineering with Korean innovation.

Sources: LG Newsroom, Korea JoongAng Daily, ChosunBiz, June 30, 2025