Deutz agrees €1.6bn acquisition of FFG

DEUTZ AG has entered into an agreement to acquire all shares in Flensburger Fahrzeugbau Gesellschaft mbH (FFG) for a total consideration of €1.6 billion. The structure of the deal combines a substantial cash payment with an equity component, reflecting both a financial transaction and a strategic partnership with FFG’s current owners.

Approximately €1.0 billion of the purchase price will be paid in cash, while around €0.6 billion will be settled through the issuance of new DEUTZ shares. This share component is designed to give the selling families a significant stake in the enlarged company and aligns their interests with DEUTZ’s long-term development.

Following completion of the transaction and the related capital increase, the FFG owner families are expected to hold up to 29.9% of DEUTZ’s increased share capital. This stake positions them as long-term anchor shareholders in the engine and drive systems manufacturer.

In connection with their new role, the families are expected to seek two seats on the DEUTZ Supervisory Board. This prospective board representation underscores the intention to involve the sellers in the group’s strategic oversight after FFG is integrated.

To implement the equity component of the purchase price, DEUTZ has called a virtual Extraordinary General Meeting for 24 August 2026. At this meeting, shareholders are to vote on a capital increase against contribution in kind, enabling the issuance of the new shares to the FFG families.

Completion of the acquisition is subject to customary conditions, including shareholder approval at the EGM and necessary regulatory clearances. If these conditions are met, DEUTZ expects the transaction to close either at the end of 2026 or in the first quarter of 2027.

FFG is a German manufacturer and maintainer of wheeled and tracked military land and special-purpose vehicles. The company employs about 1,100 people and generated approximately €760 million in revenue for the 2025 financial year on an HGB basis.

After the transaction closes, FFG is to remain operationally independent within the DEUTZ group. It will form the core of a newly created Defense business unit, giving DEUTZ a distinct platform in the defense vehicle and services segment.

DEUTZ states that acquiring FFG will accelerate the group’s profitable growth trajectory. The company links the transaction to its existing strategy, which includes financial targets set for 2030.

Specifically, DEUTZ aims for revenue of €4 billion and an adjusted EBIT margin of 10% by 2030 and says the integration of FFG should help bring these targets forward. Positioning FFG as the centerpiece of a Defense unit is presented as a way to broaden the group’s portfolio and earnings base while retaining operational independence at the acquired company.