Hensoldt Sells South African Subsidiary Amid Losses

Hensoldt, a defense supplier, is looking to divest its small South African optronics subsidiary due to losses. The company generates €15 million in revenue and employs 100 people. Discussions with around 20 potential buyers are underway, and any new owner is expected to invest in expanding the product portfolio. Hensoldt declined to comment on the matter.

German defense electronics maker Hensoldt AG is reportedly considering the sale of its South African optronics subsidiary, according to sources familiar with the matter. The company is in talks with around 20 potential buyers for the unit, which generates approximately €15 million in revenue but operates at a loss. Hensoldt employs around 100 people in its South African operation, which produces gimbal-mounted cameras and airborne electro-optical and infrared systems, including the Argos and Bushbaby brands.

The move comes as Hensoldt seeks to streamline its operations and focus on its core business, which includes its main optronics division headquartered in Oberkochen, Germany. The German division employs around 1,000 people and makes products such as thermal imaging cameras, periscopes for armored vehicles and submarines, and precision optics for chipmaking.

The sale of the South African operation is not expected to impact Hensoldt’s German optronics business, which is a key part of the company’s future growth strategy. The decision to sell the subsidiary aligns with Hensoldt’s broader strategy to reduce its dependence on the US and capitalize on the rising demand for European military capabilities.

Hensoldt has not commented on the matter, and the discussions are reportedly private. The company is working with Deloitte to review the business and explore potential buyers. The South African operation is seen as non-core by some industry insiders.

The sale of the South African optronics subsidiary is part of a broader trend in the defense sector, where private equity firms are increasingly targeting defense assets once seen as toxic. Governments in Europe have pledged to spend hundreds of billions of euros to boost Europe’s homegrown capabilities and reduce dependence on the US.

References:
[1] https://www.bloomberg.com/news/articles/2025-05-23/hensoldt-is-said-to-explore-sale-of-south-african-optronics-unit
[2] https://www.marketscreener.com/quote/index/DOW-JONES-SOUTH-AFRICA-ZA-55518594/news/Hensoldt-to-sell-South-African-optronics-business-says-source-50049543/