Flow and heat transfer of merging and bouncing droplets are studied for different Weber and Reynolds numbers and eccentricities of droplets by means of direct numerical simulation. Droplets are allowed to deform under the hydrodynamic forces of the surrounding flow. A coupled level-set and volume of fluid (CLSVOF) method is used to capture the highly deformable topology of the droplets. The method is coupled with a fast pressure solver, developed by Dodd and Ferrante, 2014, in order to circumvent the expensive iterative solvers commonly used. The temperature distribution inside the droplet and its consequent effect on the Nusselt number is studied. The results show that the Reynolds number and the initial configuration of droplets is of more important than the effect of the surface tension which governs the extent of deformations.