Japanese air conditioner maker Daikin Industries Ltd. will pay $3.7 billion to buy U.S. rival Goodman Global Group Inc., the top U.S. manufacturer of residential air-conditioning systems.

The deal, facilitated by the strength of the Japanese yen, increases Daikin's share of the U.S. market, the largest air-conditioning market in the world.

Osaka-based Daikin has more than 44,000 employees globally and operates manufacturing and sales activities in more than 90 countries; Houston-based Goodman has more than 4,500 employees, most of whom are based in Texas and Tennessee.

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