A. O. Smith Corp. and Takagi Industrial Co. of Fuji-city, Shizuoka, Japan, established a joint venture to market and manufacture tankless water heaters in North America. A. O. Smith will take over the management of Takagi’s existing North American sales and distribution organization, maintaining Takagi’s North American headquarters in Irvine, Calif. The companies expect the transaction to close in the third quarter.

Through the joint venture, A. O. Smith will offer a full line of tankless gas water heaters under its own brands in association with the Takagi brand, and will assume responsibility for the Takagi brand in the United States and Canada.