Successful Acquisition

strengthens its
position as a leading
solution provider

With the acquisition of ESG Group, HENSOLDT will expand its existing competence as a sensor solutions house to become a leading European provider of seamlessly integrated solutions for defence and security.

The simple principle of supply and demand for individual products is no longer the way business is done in the defence sector. Today’s customers want complete solutions for all their complex and individual requirements. HENSOLDT made the necessary preparations early on and developed into a sensor solution house. With the agreement to acquire ESG Elektroniksystem- und Logistik-GmbH (ESG Group), signed in December 2023, HENSOLDT has now taken a decisive next step. (Disclaimer: The acquisition is expected to be completed in H1 2024, subject to certain conditions, including obtaining necessary regulatory approvals.)

The Beginnings:
Thinking Holistic Solutions

HENSOLDT laid the foundations early on and firmly anchored the goal of becoming a "sensor solution house" in its corporate strategy. Since then, the divisions have not only had “solution” as part of their name, but their thoughts and actions have been geared towards cross-divisional holistic solutions based on products and services.

This means that the focus is no longer on individual technologies, products and their (further) development. Platforms are connected across all domains, traditional sensors are connected to virtual sensors, and sensor data is fused. The result is complete solutions that can be integrated on a plug-and-play basis and provide comprehensive, holistic decision support during operation.

Responsibility for
the System as a Whole

In line with the motto “a solution is more than the sum of its parts”, developments within the company are today undertaken not only cross-division, but also cross- domain, mindful of customers and their needs. This is evident today in the jointly developed, cross-divisional software solutions that incorporate the possibilities of artificial intelligence. In addition to sensors, issues of deployment, logistics, training and commercial terms are addressed. If required, the necessary industrial partners will also be involved in the project. Increasingly, HENSOLDT assumes the system leadership and overall responsibility, especially in complex defence projects, and in many cases leads the relevant industry consortia as a system integrator.

Current projects demonstrate the success of this approach. European defence programme ‘Future Combat Air System’(FCAS) is a perfect example. Here, HENSOLDT leads a high-performance industrial consortium and is responsible for individual work packages. For PEGASUS, the airborne reconnaissance system, HENSOLDT acts as the general contractor responsible for development. The same applies to the MUSS protection system for ground vehicles – the only one of its kind supplied in series production worldwide today. Here, HENSOLDT combines a range of solutions from the portfolio, which can reliably detect missiles, projectiles and even second-generation laser range finders, issue warnings, and automatically trigger countermeasures.

computer generated image of a semi-transparent tank. Parts of it are highlighted

In the spirit of OneHENSOLDT, this allows the company to not only offer pre-integrated solutions, but also to provide complementary services for operations, service and logistics to create added value.

Looking Ahead:
Becoming a Leading European Solution Provider with ESG Group

At the end of 2023, HENSOLDT entered into an agreement to acquire ESG Elektroniksystem- und Logistik-GmbH in order to complement its existing competencies in the areas of design and system integration. (Disclaimer: The acquisition is expected to be completed in H1 2024, subject to certain conditions, including obtaining necessary regulatory approvals.)

ESG Group develops, integrates, supports and operates highly complex, security-related electronics and IT systems for defence and security. In the market since 1967 and as an established partner to German and international armed forces, authorities and companies, ESG Group with its 1,380 employees – many of them former officers – has exceptional expertise and understanding of market and customer requirements.

Together with ESG Group, HENSOLDT will build on its expertise as a provider of seamlessly integrated solutions and develop more intelligent solutions within shorter timeframes in the future. Both companies will join forces to drive digitalisation and networking in the modern defence industry. In particular, this includes core skills in the areas of advanced electronic warfare (EW), sensor data fusion, artificial intelligence, OSINT, data analytics and cyber resilience. It also opens up new opportunities in services, training and logistics.

“The acquisition of ESG Group is an excellent fit with our overall strategy and will accelerate HENSOLDT’s development as a defence and security solution provider. By combining the highly complementary capabilities of HENSOLDT and ESG Group, we are taking a decisive step towards becoming a leading European provider of seamlessly integrated solutions. This will put us in an ideal position to meet the existing and future needs of our customers around the world.”
Thomas Müller, CEO of HENSOLDT

Ensuring the Security
of Germany and the World

The integration of ESG Group’s software engineering and systems integration capabilities is meant to support HENSOLDT’s positioning as a comprehensive solutions provider. With ESG Group’s expertise in intelligent data networks, HENSOLDT sensor systems can be integrated across domains. This will enable both companies to accelerate their international growth, while remaining firmly rooted in Germany and protecting national security interests.