Germany decides to buy 25.1% stake in defence supplier Hensoldt


Germany’s government has decided to buy a 25.1% stake in defence supplier Hensoldt at a cabinet meeting on Wednesday.

Reuters reported last week that the government aimed to purchase the stake from private equity company KKR for 464 million euros ($562 million).

Sources with knowledge of the matter have said the acquisition was intended to ward off a foreign buyer from taking control of Hensoldt, whose high-tech cameras are used in Tornado fighter jets, and which listed its shares in an initial public offering in September.

Hensoldt, a former Airbus unit, also supplies radar systems for Eurofighter jets and periscopes for Leopard tanks. KKR, which bought the company in 2016, retained a stake of more than 60% after the IPO.

The German Ministry of Defence on 17 December said the 25.1% acquisition was to protect the national security and key defence industry technologies defined in the Federal Government’s strategy paper of 12 February 2020 on strengthening the security and defense industry.

This transaction was approved on 17 December by the government Cabinet.

The federal government’s acquisition of 25.1% of shares, the so-called blocking minority, enables it to ward off unwanted structural decisions. It also means that the federal government has considerable influence, regardless of whether strategic investors can directly or indirectly acquire a large part of the shares, and can thus exercise a guiding influence.