DEUTZ acquires drone drive specialist SOBEK Group

Colo­gne — DEUTZ AG has signed an agree­ment to acquire 100% of the shares in SOBEK Group GmbH, ther­eby ente­ring the defense market. The SOBEK Group specia­li­zes in drive systems for drones, among other things. The German company with three loca­ti­ons in Baden-Würt­­te­m­­berg and Hesse is active in seve­ral specia­li­zed fields of appli­ca­tion, inclu­ding motor sports, aero­space and medi­cal technology. 

Among other things, the company supplies seve­ral top Formula 1 and Formula E teams with high-perfor­­mance pumps based on its elec­tric motors and control elec­tro­nics. This is an attrac­tive market that enables signi­fi­cant double-digit margins and demands the highest stan­dards. Howe­ver, the grea­test poten­tial curr­ently lies in the drone busi­ness, which is growing stron­gly due to geopo­li­ti­cal deve­lo­p­ments and the incre­asing importance of unman­ned defense systems. With this acqui­si­tion, DEUTZ is syste­ma­ti­cally conti­nuing its ‘Dual+’ stra­tegy of broa­de­ning its base, beco­ming less depen­dent on the cycli­cal combus­tion engine busi­ness and syste­ma­ti­cally expan­ding its defense business. 

Sebas­tian C. Schulte (photo © Deutz), CEO of Deutz, explains: “Sobek gives us direct access to the rapidly growing defense market and crea­tes the basis for stra­te­gi­cally deve­lo­ping it beyond the use of clas­sic drives.” The expan­sion of the defense busi­ness is part of the corpo­rate stra­tegy to become less depen­dent on the cycli­cal busi­ness with combus­tion engines.

Drones are one of NATO’s top areas of investment

Drones are now one of NATO’s top areas of invest­ment, as the requi­re­ments profile of many armed forces is chan­ging: away from tradi­tio­nal plat­forms and towards auto­no­mous and highly mobile systems. Unman­ned aerial systems (UAVs) in parti­cu­lar are taking center stage, as they are conside­red cost-effi­ci­ent, quickly available and opera­tio­nally flexi­ble. Mili­tary requi­re­ments are funda­men­tally chan­ging the exis­ting drone busi­ness: away from the volume-driven B2C busi­ness of Asian provi­ders and towards secu­rity-criti­­cal Euro­pean B2G solu­ti­ons that make Europe and Germany geopo­li­ti­cally independent. 

For DEUTZ, the acqui­si­tion is a logi­cal next step on the path from compo­nent manu­fac­tu­rer to system provi­der, from which other busi­ness segments will also bene­fit. The highly inte­gra­ted elec­tric drives from SOBEK offer great syner­gies with regard to alter­na­tive drives in the off-high­­way sector, parti­cu­larly in control tech­no­logy. The growing system respon­si­bi­lity in aero­space and defense opens up new potential. 

With around 70 employees, SOBEK expects to gene­rate sales in the low to mid double-digit million euro range with a signi­fi­cant double-digit EBIT margin in the current finan­cial year 2025.

The tran­sac­tion is expec­ted to be comple­ted shortly.

Advi­sor to Deutz AG: Belgravia 

Belgra­via advi­sed on this tran­sac­tion as exclu­sive buy-side M&A advisor
Team: Dr. Björn Röper (Mana­ging Part­ner), Diet­mar Rath (Part­ner), Chris­tian Olsen (Senior Vice Presi­dent), André Lauschke, Associate
www.belgravia-co.com