Foreign acquisitions of German companies are on the rise amid economic crisis

The economic crisis in Germany is leading to an increase in the number of German companies being acquired by foreign firms.

The reasons for this include the weakening of large corporations on one hand, and the current wave of bankruptcies, particularly among small and medium-sized enterprises (SMEs), on the other.

According to a report in German Foreign Policy, the Chinese e-commerce giant JD.com has acquired an approximately 59.8% majority stake in the German electronics retailer Ceconomy, which controls the Media Markt and Saturn electronics store chains.

Ceconomy’s market value is currently around €2.2 billion; the company’s recent sales were €22.4 billion, and it has over 50,000 employees. JD.com and its future partner Convergenta will hold an 85.2% stake in Ceconomy.

This acquisition will give JD.com access to over 1,000 stores, allowing it to expand its European business in competition with Alibaba and Amazon.

Ceconomy CEO Kai-Ulrich Deissner commented optimistically, stating, “As a partner with JD.com, we can accelerate our growth process.”

The transaction is still subject to regulatory approval and is expected to be completed early next year.

This is not the only planned Chinese acquisition of a major German company. Chinese sporting goods manufacturer Anta Sports Products is currently considering acquiring the German sports brand Puma.

The company, which has over 22,000 employees and recently generated a turnover of €8.8 billion, has seen its market value halve since the beginning of the year, falling to €2.52 billion.

In addition, the Indian steel giant Jindal Steel International plans to acquire Germany’s largest steel producer, Thyssenkrupp Steel Europe (TKSE), and is seeking political support in the takeover negotiations.

Narendra Kumar Misra, director of European operations for Jindal Steel International, stated last Friday that additional state subsidies in Europe are “a significant factor in our strategy” regarding the planned takeover of TKSE.

In early September, Jindal Steel submitted a non-binding offer for TKSE and pledged an investment of two billion euros.

Last year, Thyssenkrupp sold a 20% stake in TKSE to Czech billionaire Daniel Křetínský and aimed to sell another 30% of the shares, but the plan did not work out.

ThyssenKrupp has been trying to sell its steel business for years. In 2019, the EU Commission prohibited a joint venture between Thyssenkrupp and another Indian steel giant, Tata Steel, due to competition concerns.

Tata had previously entered the European steel sector in April 2007 by acquiring the Anglo-Dutch group Corus for $12 billion, becoming one of the world’s largest steel producers.

Recently, acquisitions and investments from the Czech Republic and Poland into Germany have also been increasing, but these are currently focused mainly on family businesses and small and medium-sized enterprises known as the “Mittelstand.”

This phenomenon is not entirely new; for example, the Czech group Agrofert, which until recently belonged to the new Czech Prime Minister Andrej Babiš, acquired SKW Stickstoffwerke Piesteritz and the baked goods manufacturer Lieken years ago.

According to Bundesbank data from October, Czech investments in Germany increased by nearly 30% in 2023, reaching €5 billion. For instance, at the beginning of this year, the Czech fruit brandy producer R. Jelínek acquired a 52% majority stake in BLN, Berlin’s largest craft distillery, gaining access to major food chains like REWE and Edeka.

Petr Minárech, CEO of the newly named R. Jelinek Deutschland GmbH, said, “When we started our collaboration, Jelínek was represented in about three or four stores. Now, there are hundreds.”

At the same time, the number of Polish acquisitions rose from two in 2024 to six this year. For example, the Polish cloud and Internet of Things company Transitional Technologies PSC acquired 100% of the shares in the German data analysis specialist x-Info Wieland Sacher GmbH at the beginning of this year. According to TT PSC’s general manager, Szymon Bartkowiak, new orders have been “raining down” on the company ever since.

The main reason for Czech and Polish investment in Germany is the growing wave of bankruptcies, especially among small and medium-sized enterprises (SMEs). SMEs account for about half of Germany’s economic output, provide nearly 60% of employment, and make up approximately 99% of all companies in Germany.

In fact, the number of corporate insolvencies in Germany reached a ten-year high of 11,900 in the first half of 2025, an increase of 9.4% compared to the same period last year.

The credit agency Creditreform estimates the number for the full year will be around 23,900, the highest figure since 2014.

This situation creates an opportunity for cash-rich Czech and Polish companies looking to establish a foothold in Germany, particularly in manufacturing and logistics, including export-oriented firms.

“Germany is relatively ‘cheaper’ today… This increases the attractiveness of assets for foreign buyers, including those from Poland,” Łukasz Chrabański, President of the Polish Investment and Trade Agency, told Reuters.

The total number of acquisitions of German companies by foreign firms and domestic mergers and acquisitions (M&A) has increased in recent years.

According to the London Stock Exchange Group, foreign investors participated in German M&A deals worth a total of $111 billion in the first nine months of 2024, representing a 39% increase over the same period last year.

According to the M&A Outlook 2025 report, approximately 65% of companies initiated and completed more mergers in 2024 than in the previous year.

Within Europe, Germany remains the most popular destination for foreign acquisitions. According to a recent report by the European Commission, Germany accounted for 21% of foreign acquisitions in Europe in 2024 (412 deals), the highest share within the EU.

The German manufacturing industry attracts the most foreign interest. According to a study by KfW, 33.4% of acquisitions between 2020 and 2023 occurred in this sector, with information and communication technology companies ranking second at 27.6%.