29 Acquisitions, SEK 12 Billion: Inside Atlas Copco's Global Channel Blitz

Accurate Air Engineering had been selling compressors out of California since 1961. Five branches, San Diego to Sacramento, over fifty employees who collectively knew the compressed air needs of factories, workshops, and food processing plants up and down the state. The kind of business where the owner's son might take over someday, or might not, and either way the company was embedded in its territory like tree roots. The service technicians knew which plants ran their compressors hardest, which purchasing managers preferred phone calls over emails, which maintenance supervisors would authorize a repair and which ones needed to check with the plant director first.

In 2024, Atlas Copco bought it. The Accurate Air name came off. The branches became "Atlas Copco Compressors factory direct" locations. The employees stayed. The service vans got new paint and new GPS tracking. The inventory system switched over to Atlas Copco's central parts catalog. A customer who had been buying from Accurate Air for twenty years now had a different company name on the invoice but the same technician showing up on Thursday morning. Someone in Nacka, Sweden signed off on the deal, and sixty-three years of independent business in California became a line item in a quarterly report.

Distribution

Industrial Compressed Air Systems

Atlas Copco has been buying small compressed air distributors for over a decade, and no single transaction like this one would be worth writing about. What made 2025 different was the pace. Twenty-nine acquisitions closed across the calendar year, for a combined SEK 12 billion. A handful were not distributors at all but manufacturers and technology companies, Kyungwon Machinery in Korea being the largest. The vast majority were distributors. RM Boggs in Iowa, Ace Air in Northern Ireland, Casa dei Compressori in Milan, names that mean something in their local markets and nothing anywhere else. The biggest had fifty employees. Most had fewer than twenty. The press releases followed a template when they appeared at all: a quote from the business area president about geographic coverage, a note that the deal price was immaterial to Atlas Copco's balance sheet. Nobody in the financial press paid much attention. Twenty-nine deals, none of them large enough to warrant a headline.

The people who should be paying attention are the Chinese compressor manufacturers trying to build overseas distribution. Kaishan and Hanbell are probably the most exposed, but there are a dozen others at various stages of international expansion. Atlas Copco is buying the distributors those companies need. Once a distributor converts to a factory direct branch, it will never carry a competing brand again.

Once the distributor converts, the spare parts margin and the service revenue flow to Atlas Copco. The branch sells Atlas Copco-family products. Nobody steers anyone toward a competing brand.

Atlas Copco runs eleven compressor brands. A job listing from 2025 for a regional sales manager in Italy put nine of them under a single role. A procurement manager at a food factory in Lombardy requesting competitive quotes from Atlas Copco, CECCATO, and MARK has, without knowing it, requested three quotes from the same parent company.

Atlas Copco acquired Quincy from EnPro Industries in 2010 for USD 190 million and explicitly committed to developing the brand independently, leaving its US dealer network intact. The dealer agreements stayed in place. The distributors kept their territories. Quincy machines kept showing up in the same warehouses with the same branding and the same regional sales reps they had always had. To the distributor, nothing changed except the name on the quarterly check.

Channel

Distributor Operations

Service

Parts & Aftermarket

Fifteen years later, Atlas Copco is reacquiring those dealers. The sequence looks neat in retrospect: deploy a brand, let independent distributors build customer relationships over a decade, absorb the distributors into direct operations along with all their customer knowledge and service contracts. Accurate Air, sixty-three years old with five locations whose technicians had been servicing compressors in California's Central Valley since before some of their customers' plants were built, fits the pattern. So does Compressed Air Technologies in the Southeast. Whether any of these distributors saw it coming is an open question. The Quincy dealers probably assumed their independence was durable. It lasted fifteen years. That is a long time in compressed air and a short time in Swedish corporate planning.

Plot the US acquisitions since 2022 on a map. Thirteen states, Florida to Oregon, spread across the Southeast and Midwest without clustering. The pattern repeats overseas. Atlas Copco has completed roughly 185 acquisitions over two decades, with the pace accelerating. The previous annual record was 25 deals in 2022.

Every Chinese compressor exporter entering North America or Europe in the past decade has done so through independent distributors. Most of those partners are now on Atlas Copco's target list, or have already been acquired, or are fielding calls from Atlas Copco's business development team.

A sales manager at a mid-size Chinese compressor manufacturer identifies a compressed air distributor in greater Atlanta. This is a composite, not a documented case, but the elements come from the public acquisition record. The business has been operating for twenty years. It carries multiple brands, including one Chinese line it picked up three years ago when the pricing made sense. It has contracts with manufacturing plants and food processors across northern Georgia. It employs a dozen service technicians who know which plants run three shifts and which run one, who know the maintenance directors by name, who carry the right spare parts in the right trucks because they have been driving to the same plants for a decade. The distributor's owner likes that the Chinese machines are competitive on price and the margins are good, better than what Atlas Copco pays on the same volume. The Chinese manufacturer ships a container of machines, negotiates dealer terms, starts building volume. The relationship works. Orders grow. The distributor's technicians learn the Chinese machines, stock the parts, start servicing them. The Chinese brand is building a real footprint in northern Georgia for the first time. Then, sixteen months in, the distributor's owner gets a call. He is sixty-four. His daughter is a pediatrician in Seattle. His son-in-law works in finance. Nobody in the family wants to run a compressor business. Atlas Copco offers a clean exit at a price the owner was not expecting to hear for another five years. He takes it. The business converts to a factory direct branch. The Chinese brand's products come off the shelf. The parts inventory gets restocked from Atlas Copco's central warehouse. Every customer relationship the Chinese manufacturer was counting on now belongs to Atlas Copco's direct organization. The sales manager in Zhejiang finds out when a call to the distributor's old number goes to a new voicemail greeting.

Compressed Air Technologies, a Quincy distributor covering most of the Southeast with 53 employees, was acquired in 2024. Air Compressor Works in Florida, 50 employees, in 2025. Each was a potential channel partner for any manufacturer seeking US distribution. Each is now unavailable.

The thing about compressed air distributors is that nobody outside the industry has heard of any of them, and that is precisely what makes them acquirable at the prices Atlas Copco is paying. These are not glamorous assets. A twenty-person shop with a parts warehouse and a fleet of service vans in a light industrial park off an interstate exit ramp. The industry press barely covers individual transactions. The financial press ignores them entirely. But twenty-nine of those shops add up to something.

Most of these businesses were founded between the 1960s and 1990s. The owners are retiring. Their kids do not want the business. Atlas Copco shows up with a check and a promise to keep the staff employed. Hard to say no.

What the customers of those acquired distributors get, whether they asked for it or not, is SMARTLINK. According to technical documentation from the IoT infrastructure partner OrangeNXT, the system was connected to over 150,000 compressor units and processing roughly 130 million data messages per day as of a 2018 platform rebuild. That was seven years ago, and the installed base has grown since. Every new Atlas Copco compressor ships with SMARTLINK connectivity built into the controller. Everything the machine does gets logged and sent to centralized servers. The data goes somewhere. Specifically, it goes to a monitoring organization that can see every connected machine in a region simultaneously, which is an advantage that no independent distributor can replicate with a smaller installed base.

Technology

Centralized Monitoring & IoT Infrastructure

Atlas Copco's UK division has published a handful of case examples. The one that best illustrates the advantage over independent service is from a steel plant. SMARTLINK detected abnormally high element temperatures across every compressor on site simultaneously. All of them spiking at once. A service technician working on a single unit in isolation, which is how most independent distributors operate, would have assumed a compressor fault and started troubleshooting mechanically. Because the centralized system could see all machines behaving the same way, the engineer suspected an environmental cause. It turned out to be building ventilation pushing ambient temperature to 40°C. There was no compressor problem. There were also cases at an aerospace facility and a jam manufacturer where the monitoring caught issues, an overheating compressor rerouted to a nearby engineer, an anomalous dewpoint reading on a dryer that would have sent moisture into a food production line, but the steel plant example is the one where the structural advantage of centralized data is clearest. A single-site technician cannot see a pattern that only exists across multiple machines.

An owner who planned to stay independent for five more years has to reconsider when the distributor two counties over just became a direct branch with pricing and digital monitoring the holdout cannot access. The remaining independent sees Atlas Copco's branch offering twenty-four-hour remote monitoring, predictive maintenance alerts, and parts delivered from a centralized warehouse, while the independent is still dispatching from a local stockroom and hoping the right filter is on the shelf. Every conversion makes the next one more likely. Whether that pressure is the main reason Atlas Copco hit 29 deals in 2025, or whether the retirement wave among boomer-generation owners would have produced willing sellers regardless, is not clear. Both forces are probably operating at the same time, and both are accelerating.

SUTO iTEC. Headquartered in Hong Kong, operations in China and Germany, a hundred and thirty-six employees. They make instruments that measure compressed air quality and flow. Brand-neutral. Works on any compressor from any manufacturer. SMARTLINK only sees Atlas Copco machines. SUTO sees the rest of the compressor room.

Global

Manufacturing

Precision

Instrumentation

Integration

Cross-brand Audit

No public description exists for how the company intends to integrate SUTO. But a service engineer who walks into a facility with Atlas Copco machines and a competitor's machines can currently only monitor the Atlas Copco equipment remotely. Add SUTO sensors and that engineer can now measure the competitor's machines too, generate a cross-brand energy efficiency comparison, and hand the customer a report showing which machines are running well and which ones are costing too much per cubic meter of air. The competitor's distributor does not get a copy of that report. If the numbers favor a replacement, the sales pitch writes itself.

Whether Atlas Copco will push this kind of integration aggressively or leave SUTO operating at arm's length as a standalone instrumentation business is an open question. The capability exists. If it gets deployed across the expanding network of direct branches, every compressor room in the branch's territory becomes auditable regardless of what equipment is installed.

Atlas Copco's investor relations page, incidentally, categorizes all of these deals under "bolt-on acquisitions." No separate line item exists for the distributor absorption program. The SEK 12 billion shows up aggregated with everything else.

The stock jumped 11.89% on January 27, the day Atlas Copco reported Q4 2025 earnings. That needs context. Full-year organic revenue declined 1%. Adjusted operating profit fell 10%. Compressor Technique posted a 24.3% operating margin in Q4, the highest of the four business areas, and the market decided the margins were the story, not the revenue decline.

Distributor earnings across the industry were soft in 2025. Seller valuation expectations were low. Owners who might have held out for a higher price in a strong year were willing to sell at lower multiples. Some of these businesses had their worst year since 2020. A distributor that would have asked for 8x EBITDA in 2023 might take 5x in 2025 and feel grateful for the exit. The psychology of selling a business you built over thirty years at a cyclical trough is not captured in the press releases. Atlas Copco's balance sheet, generating SEK 6.8 billion in quarterly cash flow even in a weak market, could fund the entire acquisition program and a special dividend simultaneously. When an analyst asked CFO Peter Kinnart on the earnings call whether the special dividend meant the acquisition pipeline was running dry, Kinnart said no: the company could afford both. It was not a hedge. The cash flow statement supports it. Barclays, which upgraded the stock in December with a target of SEK 178, projects mid-single-digit sales growth for 2026. The distributors acquired at trough-cycle prices in 2025 will ride that recovery under Atlas Copco's ownership, and the people who sold to them will not.

Chinese compressor manufacturers that lose their distributor in a given market have to build their own local operation to replace it, and most of them are not set up to do that. It is not just a matter of hiring a few people. You need a parts warehouse, service vehicles, technicians with local certifications and language skills, a customer service phone line, a legal entity, insurance, employment contracts under local labor law. The organizational capabilities required to run service operations in a dozen countries simultaneously have almost nothing in common with the capabilities required to manufacture compressors in Zhejiang and ship containers. The planning horizons are different, the talent pool is different, and the tolerance for years of operating losses before the overseas operations break even is something most Chinese compressor companies have not been tested on. Kaishan has been investing in overseas production and service for several years, and a few others are following, but they are the exceptions. Most Chinese compressor exporters still depend on the distributor model. Twenty-nine deals closed in one year. The map of available independent distributors is smaller than it was twelve months ago and will shrink further by the end of 2026. The owners are getting older. The checks keep coming.

The Trident Pneumatics acquisition in India works differently. Trident was not a distributor. It was a domestic compressor manufacturer that had built a real business in a growth market where Atlas Copco already had distribution. Atlas Copco absorbed a competitor, and in doing so removed a company that might have eventually become a regional champion or an acquisition target for someone else. Manufacturers in developing markets that have not yet built an international presence can lose more than distribution access when Atlas Copco comes calling. They can lose their business entirely, before they had the chance to grow it into something that would have been too expensive to buy.

For anyone building an overseas compressed air business on the assumption that the independent distributor network will still be there in three to five years: the assumption deserves testing.