HENSOLDT successfully acquired ESG Elektroniksystem- und Logistik-GmbH (“ESG“) from an investment entity managed by Armira Beteiligungen GmbH & Co. KG (“Armira”). The acquisition, valued at an enterprise worth of EUR 675 million with an additional earn-out of up to EUR 55 million based on specific performance targets by December 31, 2024, marked a pivotal step in HENSOLDT’s expansion strategy.
The acquisition bolstered HENSOLDT’s sensor solutions strategy, leveraging ESG’s expertise in innovation, software engineering, and systems integration. The agreement, finalised in December 2023, was supported by HENSOLDT’s major shareholders, the Federal Republic of Germany and Leonardo S.p.A.
Thomas Müller, CEO of the HENSOLDT Group, expressed enthusiasm about the acquisition, stating, “The acquisition of ESG aligns seamlessly with our strategic goals, propelling HENSOLDT’s evolution as a premier provider of defence and security solutions.”
Christian Ladurner, CFO of the HENSOLDT Group, highlighted the significant synergies identified between the two entities, paving the way for substantial value creation while maintaining prudent capital allocation and net leverage.
ESG, a renowned German defence systems integrator, boasted low double-digit annual revenue growth and a strong capex-light business model. The company, founded in 1967, served as a critical technology and innovation partner for defence and public security, employing 1,380 individuals across Germany, the Netherlands, and the USA.
The acquisition of ESG equipped HENSOLDT with advanced software engineering and systems integration capabilities, facilitating the development of smarter, faster solutions, particularly in digitalising the battlefield and creating integrated network solutions. Additionally, it expanded HENSOLDT’s offerings across training, logistics, and maintenance for both internal and third-party installations.
By integrating ESG’s capabilities, HENSOLDT positioned itself as a comprehensive solutions provider, harnessing expertise in intelligent data networks to create integrated solutions for multi-domain operations.
The transaction, subject to regulatory approvals, was expected to be finalised in the first half of 2024.