Bundeskartellamt clears merger of defence electronics manufacturers Hensoldt and ESG

The Bundeskartellamt has today cleared the acquisition by Hensoldt Holding Germany GmbH, Taufkirchen, of ESG Elektroniksystem- und Logistik-GmbH, Munich. The federal government holds a 25.1 per cent stake in Hensoldt through the German promotional bank KfW.

Andreas Mundt, President of the Bundeskartellamt: “The merger does not raise any competition concerns as the two companies have so far mainly offered different products and services in the area of security and defence electronics.”

Hensoldt is a manufacturer of defence electronics hardware. Its product range focuses on radars and optoelectronic systems. ESG, in contrast, is a system integrator and mainly develops, integrates and provides support for third-party electronic systems, mostly from the defence industry. ESG’s services include not only the integration of different electronic components, such as those of the Bundeswehr’s fighter jets, but also spare parts management.

The merger parties have already been working together, for example within German FCMS. FCMS develops networked sensor and effector solutions as well as drone systems and cross-platform sensors and effectors for flying unmanned systems. The creation of German FCMS was assessed and cleared by the Bundeskartellamt in 2020