DEUTZ (DEZ) M&A Announcement summary

Deal rationale and strategic fit

• Acquisition targets rapid expansion in the defense sector, especially UAVs, aligning with a dual strategy to diversify beyond combustion engines and become a system integrator.

• SOBEK is a profitable specialist in electric drive systems for drones and aerospace, providing immediate access to new technologies and high-growth markets.

• The deal enables entry into the European defense ecosystem, leveraging local supply chains, ITAR-free sourcing, and reducing dependency on traditional business lines.

• SOBEK's expertise supports expansion into aerospace, motorsport, medical technology, and robotics, with potential for further civil aviation applications.

• High-tech, German-made products and resilient local supply chains are key differentiators for defense customers.

Financial terms and conditions

• Transaction based on an EBITDA multiple of 11x, with all shares of SOBEK to be acquired.

• SOBEK expected to deliver €10–12 million EBITDA in 2025, with revenue in the low to mid double-digit million euro range and double-digit margins.

• Financing secured through existing credit lines, with an option for a capital increase of up to 10% of share capital depending on market conditions.

Synergies and expected cost savings

• Industrialization scale, sourcing, and service infrastructure from the acquirer will enhance SOBEK's operations and accelerate scaling in the drone market.

• Joint development of modular system platforms and powertrain kits for defense and adjacent markets is anticipated.

• Cross-selling opportunities and lifecycle revenues expected through bundling with the existing customer base.

• SOBEK's integrated electric drives offer synergies for alternative drive systems in the off-highway sector, especially in control technology.