A. O. Smith Corp. announced it has acquired Applied Energy Recovery Systems Inc. (AERS), a leading manufacturer of commercial and residential heat-pump water heaters. Terms of the transaction were not disclosed.

The AERS product line includes the E-Tech line of commercial and industrial water heaters as well as commercial outdoor- and indoor-pool heating systems and residential water-heating and swimming-pool products.

“The acquisition of AERS allows A. O. Smith to reinforce our leadership position in providing energy-efficient water-heating solutions and provides us a strong platform from which to address the growing interest from our customers in renewables,” Ajita G. Rajendra, president of A. O. Smith Water Products Co., said.

“We plan to leverage the technology, engineering expertise, and know-how from AERS to expand our capabilities and product lines across the globe,” Rajendra added.

Heat-pump water heaters capture heat from the surrounding air or water sources, such as waste water generated by a building’s chiller or cooling system, and use it to heat water for hot-water uses. The energy savings generated from the captured heat significantly exceeds the energy cost of running the heat pump, making this technology an efficient means for water heating, with savings of up to 80 percent.

With 2008 sales of $2.3 billion, A. O. Smith Corp. applies energy-efficient technology and solutions to products marketed worldwide. The company manufactures residential and commercial water-heating equipment and offers a product line that features brands in North America and China. A. O. Smith is also one of the largest manufacturers of electric motors for residential and commercial applications in North America.