Danfoss acquires remaining shares in Leanheat

Date: 8 May 2019

Danfoss has taken over the full ownership of Finnish startup company Leanheat Oy specialized in the optimization of heating in centrally heated buildings by using artificial intelligence (AI) and sensors.

By acquiring the remaining shares in Finnish company Leanheat, Danfoss has further strengthen its position in the global market for Multi-Family Houses and District Heating Systems.

The combination of Danfoss’ deep system- and application know-how and Leanheat’s strong capabilities in developing analytics-based software solutions is an important lever to accelerate Danfoss’ position within important segments like Multi-Family Houses and District Heating Systems, and to further advance the digitalization of its core components.

The acquisition follows Danfoss strategic focus on establishing strong core businesses with leading market positions.

Lars Tveen, President Danfoss Heating Segment (right) and Jukka Aho, CEO Leanheat (left) at signing ceremony.

“We are proud and honored to be able to assume ownership of Leanheat. Over the last three years, we have gotten to know each other better both as business partners and as colleagues. And every interaction has reinforced our common vision and unmatched value proposition in our markets. We have great respect for the technology they have built and taken to market, for their incredible team, and for their entrepreneurial mindset – it makes up the heart of Leanheat and this is what we want to preserve going forward”, said Lars Tveen, President Danfoss Heating.

The acquisition of Leanheat brings new innovative and complementary services and business models to Danfoss Heating’s core business, and the infusion of Leanheat’s talent and technology is an important step to deliver an end-to-end software and service offerings from district energy plant optimization to building optimization.

Leanheat has consistently outperformed the original business plan which was developed as part of the initial investment in 2016, and the completion of the acquisition is a testament to the incredible accomplishments made by Leanheat within a very short timeframe. The Leanheat installed base has grown rapidly and the potential to make more buildings smart is huge. By the end of 2018, Leanheat was installed in 100,000 apartments globally and the aim is to achieve the milestone of one million apartments by 2022.

“I am pleased with the development of both our business and partnership with Danfoss over the past years. Our decision to partner with Danfoss in 2016 allowed us to move ahead at unprecedented speed to build a strong domain leadership in energy optimization using AI and sensors. We can all be proud of our achievements so far, and I am looking very much forward to embark on the next phase of our growth journey, which will enable us to accelerate our International expansion even further,” says Jukka Aho, CEO Leanheat”.

In 2016, Danfoss partnered with and invested in Leanheat Oy and Danfoss has continuously increased its shares in Leanheat. Now an agreement has been signed to acquire the remaining shares.

Facts about Leanheat:

Fully automated and self-learning, Leanheat’s solution provides real-time optimization not only for individual buildings, but entire clusters of apartment buildings – while at the same time giving the opportunity for district heating companies to serve their customers more efficiently and with a smaller carbon footprint.

Leanheat’s solution has already been installed in buildings in Finland, Denmark, Sweden, Germany, Poland, and Norway and new pilots with district heating companies in China are showing great potential.

The start-up development of the intelligent monitoring solution began in 2011, with the first pilots were set up. In 2016, the company Leanheat Oy was established and recognized as a first-mover within digital HVAC efficiency. In the same year, Danfoss entered into a partnership with Leanheat.

From 2016 to 2019, Leanheat has increased its number of employees from 12 to 50.