[4] He started producing automatic valves for refrigeration plants, which previously had to be imported from the United States.

[5] Clausen's initial budget was small, and his equipment consisted of a manual air pump and a zinc trough for testing the valves.

A logo reading "Danfoss"—a portmanteau of the Danish words "Danmark" (Denmark) and "fosser" (to stream or sparkle)[7]—was attached to all valves.

[8] In 1946, the word from the logo became the official company name, and Danfoss opened an office in Copenhagen with 261 employees.

American companies had developed comparatively small hermetic compressors for use in home refrigerators.

[10] During a trip to the United States and Canada in the fall of 1950, Clausen visited several manufacturers of hermetic compressors and gathered information, not only about technical specifications, but also about organisational details, compensation and output optimisation.

The agreement allowed Danfoss to manufacture hermetic compressors and sell them in any country except for the US, Canada, Great Britain and Ireland.

[13] 1960: The company begins using synthetic materials and oils for greater stability in low as well as high temperatures.

[22] 2008: TOOL4COOL®, software for the flexible control of refrigeration plants, is introduced, and a production site opens in Wuqing, China.

[23] In 2005, after years of financial losses, the board of directors announced that Danfoss would lay off 700 employees.

On May 27, 2009, Danfoss announced that it would cease production in Flensburg within a year and lay off another 450 employees in response to the recent financial crisis.

The company's chief operations officer, Kim Fausing, reported that its household compressors business was incurring millions in losses.

[24] Politicians appealed to Danfoss executives to reconsider, saying that keeping the production plant in Flensburg would give a positive signal for the German-Danish economic region, but the company went forward with the closing.

[25] The Flensburg headquarters continued to house the company's research and development, sales, and product support departments.

According to Nis Storgaard, chief development officer of the Danfoss Group, the reason for the sale was the parent company's decision to concentrate on other areas of the climate and energy sector.

According to estimates in the media, it was a small deal for Danfoss, which had 26,000 employees worldwide and annual sales of about 3.4 billion euros at the time.