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Acquisition of Eaton Hydraulics good for Danfoss India unit

Chennai: The acquisition of power management company Eaton’s Hydraulics business for $3.3 billion augurs well for Danish major Danfoss A/S not only globally but also for its Indian operations, said Danfoss officials.

On Tuesday Danfoss and Eaton announced a deal, whereby the former has agreed to buy the latter’s global Hydraulics business for $3.3 billion.

Interestingly, the hydraulics divisions of both Danfoss and Eaton are present in Pune in India.

“Eaton’s hydraulics business is similar to that of Danfoss Power Solutions. Eaton is present in industrial hydraulics while Danfoss Power Solutions-India is not. So, it will be an add on in terms of Indian operations,” Upinder Razdan, Managing Director, Danfoss Power Solutions-India said. Razdan opined, the acquisition will provide Danfoss greater in-roads into the US market while the Danish company is already a major player in the European markets.

“Eaton has a strong brand appeal and presence in India. They also have a big engineering centre in India. The global hydraulics market is majorly shared by handful of players,” Ravichandran Purushothaman, President, Danfoss India Region said.

According to Eaton India, it manufactures and markets a wide range of products for the power and motion control industry. In addition, Eaton also imports and trades a variety of hydraulic and fluid conveyance products.

Eaton has competitive offerings in practically all segments, ranging from mobile to industrial applications, positioned as a hydraulic systems solution provider with a full product range.

The Hydraulics manufacturing facility at Pimpri in Pune is an Eaton Center of Excellence (COE) for gear pumps and has been expanded to also manufacturing of steering control units and hitch valves.

The other key products manufactured at this facility include Gear Pumps, Vane Pumps, Piston Pumps, Valves, Power Units, and Cylinders, states Eaton India.

On the other hand the Power Solutions division of Danfoss is a provider of mobile hydraulics for the construction, agriculture and other off-highway vehicle markets.

The product portfolio includes electronic controls, pumps, steering, mobile electrification, pumps and valves, motors, sensors and transmitters and others.

“The main sectors we serve are construction/farm/material handling and Danfoss Power Solutions contribute about one third of Danfoss’ global revenues,” Domenico Traverso, President-Work Function Division and also Danfoss India Board Member said from Pune.

Traverso said the division is involved in electrification and supply solutions for buses and trucks which is relative a new segment for the company.

Eaton Hydraulics provides products for customers in markets such as agriculture, construction, and in industrial market segments.

Eaton’s hydraulincs business will be transferred into Danfoss Power Solutions, adding approximately 11,000 employees and 2019 sales of $ 2.2 billion (2.0 billion euros) to the business segment, which will double the hydraulics business.

“Today, we take a significant and transformational step in creating a global leader in mobile and industrial hydraulics. It is a once-in-a-lifetime opportunity to combine our largely complementary portfolios and geographic footprints,a Kim Fausing, Danfoss President and CEO was quoted as saying in a statement.

“With this agreement, we continue to invest in our core hydraulics business and digital solutions to stay a strong technology partner,” he added.

“We believe Eaton’s Hydraulics business will benefit greatly from being part of a company that has hydraulics at its core,” Craig Arnold, Eaton Chairman and CEO said. “When complete, this deal will bring together two talented teams with deep hydraulics knowledge and expertise.a-And Eaton’s hydraulics team will be part of a company that is committed to becoming a global leader in mobile and industrial hydraulics.a-The combined business will also benefit customers and distributors by offering industry-leading technology and a much broader portfolio of hydraulic solutions,” Arnold added.

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