Deutz carries out a successful capital increase of €72 million

Deutz has successfully placed around 12.6 million new shares with institutional investors. The net issue proceeds from today’s capital increase give the Company the flexibility to invest further in growth by acquisition.

“We want to establish ourselves among the top three independent engine manufacturers by 2030 and to seize the opportunities of a consolidating market. We intend to increase revenue from our profitable service business to more than €600 million by 2025, in particular through growth by acquisition. And we aim to expand our product ecosystem – in part by adopting a buy-and-build approach – in order to become more resilient. High demand from investors shows that the capital markets support this strategy. Their confidence sends a strong message and encourages us to stay focused on pursuing our goals,” says CEO Sebastian C. Schulte.

Deutz CFO Timo Krutoff adds: “We are very pleased that we were able to successfully place the capital increase in the current difficult environment. Not only because we were able to gain new renowned shareholders for Deutz. Following the recently announced acquisition of the US genset manufacturer Blue Star Power Systems, the proceeds also give us the flexibility to make targeted investments while maintaining a very solid financial position – in order to achieve our strategic goals and thus create long-lasting added value for our shareholders.”

Deutz announced its acquisiton of Blue Star Power Systems just recently. The acquisition of this manufacturer of diesel and gaseous generator sets (gensets) will make Deutz a major provider in the field of decentralized energy supply and enable it to tap into a fast growing and yet less cyclical market. Nevertheless, Deutz continues to see potential for growth in its current core business, for example as a result of the consolidation of the industry, and intends to play an active role in this consolidation. To this end, the Company entered into an alliance with Daimler Truck for the development and marketing of heavy- and medium duty engines in 2023. Also last year, it reached agreement with Rolls-Royce’s Power Systems business unit on taking over the sales and service activities for various industrial engines. Moreover, the agreement just reached with TAFE – a leading agricultural machinery company in India – will enable Deutz to expand into a further high-growth region.

The new shares were placed with institutional investors; pre-emption rights were disapplied. As a result of the placement of the new shares, Deutz AG’s share capital has increased by 10 percent to around 138.8 million no-par-value bearer shares. The new shares are expected to be admitted to the segment of the regulated market that is subject to additional post admission obligations (Prime Standard) on the Frankfurt Stock Exchange and to the regulated market on the Düsseldorf Stock Exchange on July 5, 2024 without the requirement for a prospectus. Trading in the new shares, which will be included in the Company’s existing listing, is scheduled to commence on July 8, 2024. Commerzbank and M.M. Warburg & Co. supported the transaction as joint global coordinators and joint bookrunners.

As part of the transaction, Deutz is committing to a lock-up, i.e. the Company will not, subject to the usual market exceptions, issue any further shares or financial instruments that can be converted into shares or carry out a further capital increase within a six-month period.