German government acquires 25% stake in KKR's Hensoldt

The stake is said to be valued at around €464m, a report from Reuters noted. The report added that the rationale behind the acquisition was to prevent a foreign company from taking over Hensoldt, citing sources with knowledge of the matter.

According to a statement, the security agreement that was established between the German government, KKR and Hensoldt has been updated as part of the transaction. The agreement is intended to protect Germany's security interests and granted the Federal Republic of Germany the option to acquire up to 25.1% in Hensoldt.

KKR acquired Hensoldt (then known as Defence Electronics) from Airbus in March 2016, investing alongside Deutsche Bank in a deal valued at €1.1bn. According to Unquote sister publication Debtwire, a consortium of banks including UniCredit, IKB Deutsche Industriebank, Commerzbank, SMBC Capital, Deutsche Bank, Crédit Agricole, Mizuho Corporate Bank and Idinvest Partners provided debt financing of €875m to back the buyout.

Hensoldt completed its IPO in September 2020 and the company now has a market capitalisation of €1.53bn. KKR retained a majority stake in the business following the IPO and will now hold a 43% stake in the company. Hensoldt had an enterprise value of €2.29bn at the time of the IPO.

Company
Ulm-headquartered Hensoldt produces defence and security sensors for use in operations including air defence, homeland security and military base defence. Hensoldt employs 5,500 people and reported 2019 revenues of €1.1bn.

People
Hensoldt – Thomas Müller (CEO).
KKR – Johannes Huth (partner, head of KKR EMEA).

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