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Deutsche Beteiligungs AG

Overview

Deutsche Beteiligungs AG (DBAG) was founded in 1965 and is the oldest private equity company in Germany. DBAG creates value for its shareholders by way of two business lines – providing investment services to funds and investing along-side these funds. The funds bundle the assets of institutional investors and make investments in ‘Mittelstand’ companies across the sector of mechanical and plant engineering, among automotive suppliers, industrial services providers and manufacturers of industrial components.

DBAG has the flexibility to take both majority and minority stakes through a buyout or by providing growth capital and invests in companies with an enterprise value of between €50-250mn. The aim is to generate sustainable growth with a focus on patience, prudence and on partnership for long-term gain.

In terms of sectors DBAG is focused on industrial businesses and providers of related services, like mechanical and plant engineering or automotive suppliers. DBAG is attracted by companies with development potential, based on good technology, good access to first-class customers and globalised business models. They are leaders in their markets, generally operate globally, are led by entrepreneurially driven managements and demonstrate the potential for considerable value growth.

DBAG’s shares are listed on the Frankfurt Stock Exchange and an investment in DBAG gives investors access to not only a high quality portfolio of private companies, but also, to the revenues generated by DBAG’s fund investment service activities. In 2016 DBAG has aligned its dividend policy to reflect the development of its business model and to make dividends even more shareholder-friendly: The intention is to pay a stable dividend, which will increase whenever possible.

  • Direct manager Frankfurt-listed
  • Investment focus: German speaking countries
  • Deal focus: MBO/Growth financing
  • Market cap (30.9.2016): €444.9mn

Key financials

"Our core business objective is to sustainably increase DBAG‘s value - through growth in both lines of business: from our fund investment services and by supporting our portfolio of hidden champions of the German ‚Mittelstand‘ in implementing their sustainable, value-creating corporate strategy. The success of our approach is evidenced by a total return for DBAG shareholders of 13.6 percent on average over the past ten years."

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Manager Overview

Stock exchange-listed Deutsche Beteiligungs AG (DBAG) invests in well-positioned, mid-sized companies with growth potential in selected sectors. With its experience, expertise and equity, DBAG supports its portfolio companies in implementing sustainable value-creating corporate strategies. DBAG’s entrepreneurial approach to investing has made it a sought-after investment partner in the German-speaking region. DBAG has achieved superior performance over many years – for its portfolio companies as well as for its shareholders and investors.

DBAG also raises closed-end private equity funds, which bundle the assets of institutional investors. DBAG advises the DBAG funds in selecting, developing and, ultimately, divesting their portfolio companies or their interest. Employing its shareholders’ assets, DBAG enters into investments as a co-investor alongside these private equity funds.

  • Core sectors: Mechanical and plant engineering, automotive suppliers, industrial services, industrial components
  • Investment focus: Mid-market companies in German-speaking countries with an enterprise value of €50-250mn and annual revenues of €50-500mn
Susanne Zeidler

Market commentary

Deutsche Beteiligungs AG ended the 2015/2016 financial year posting net income of €50.2mn. Contributing towards that performance were profitable divestments to strategic investors with whom DBAG was able to realise a premium on the general market valuation. The consolidated comprehensive income reached €43.0mn. After taking into account the capital increase shortly before the end of the financial year, this results in a return on net asset value per share of 16.0 percent. 2015/2016 was a year of far-reaching change in the portfolio: three companies were divested and five new investments were agreed. DBAG initiated investment decisions on nearly €278mn, of which €62mn will come from DBAG. A dividend of €1.20 per share, or a total of €18.1mn, has been recommended for distribution to shareholders. For 2016/2017, DBAG expects net income moderately below that of financial year 2015/2016 on a comparable basis.

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