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Samsung to buy German maker of air conditioning, heating

systems

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Deal is firm's biggest acquisition in eight years since

Harman

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Samsung aims to tap demand for AI data centre cooling

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Analysts say market expected biggest deals to involve

chips

(Recasts, adds comments from Samsung's annual shareholder

meeting, background)

SEOUL, May 14 (Reuters) - Samsung Electronics ( SSNLF )

said on Wednesday it had agreed to buy Germany's

FlaktGroup for 1.5 billion euros ($1.68 billion) as it looks to

meet growing demand for cooling of data centres used for

artificial intelligence projects.

In the South Korean company's biggest acquisition in eight

years, it will purchase the air conditioning and heating systems

maker from private equity group Triton.

The data centre segment has a high barrier to entry

requiring global supply experience and the ability to present

optimal designs and solutions, Samsung said in a statement. It

expects the FlaktGroup deal to close within this year, it said.

Samsung, led by Chairman Jay Y. Lee, said at a shareholder

meeting in March that it was looking for "meaningful" deals this

year to drive growth after lagging behind rivals in tapping the

AI chip boom led by Nvidia ( NVDA ). Samsung added it aimed to

pursue acquisitions in the chip industry.

Investors expecting bigger deals involving Samsung's

cash-cow chip business might feel underwhelmed by the FlaktGroup

announcement, analysts said.

"This acquisition is more about reinforcing its consumer

electronics and home appliance businesses, so it is not the

game-changing deal the market had been hoping for," said Greg

Roh, head of research at Hyundai Motor Securities.

Samsung's appliance business also makes commercial cooling

and heating systems.

"It feels like the company is playing it safe rather than

making bold bets," Roh said.

Shares in the consumer electronics and semiconductor

maker inched up 0.7% largely in line with the benchmark KOSPI

.

Samsung has shunned major acquisitions since its $8 billion

purchase of car electronics maker Harman International

Industries in 2017. This month, Harman agreed to buy the audio

business of U.S. firm Masimo ( MASI ) for $350 million.

Consumer audio is a new growth engine, Samsung has said,

alongside cooling and heating systems, medical and robotics.

In December, Samsung became the largest shareholder of South

Korea's Rainbow Robotics with the purchase of an

additional 267 billion won ($189.03 million) stake.

Samsung last year formed a joint venture with Lennox

in the heating, ventilation and air conditioning (HVAC) sector,

and was among the bidders for Johnson Controls International

HVAC assets that were bought by rival Robert Bosch for

$8 billion last year.

($1 = 0.8937 euros)

($1 = 1,412.5000 won)