50 years of Deutsche Beteiligungs AG: Oldest German private equity company celebrates half a century of investing in German “Mittelstand” and 30 years as a listed company

  • Investment partner to the “Mittelstand” with an equity investment volume of 2.5 billion euros to date
  • Solid constant on the stock market with an average return on equity of more than 15 percent p.a.
  • Pioneer in the private equity business in Germany

Frankfurt am Main, 1
October 2015. Germany’s oldest private equity company is celebrating two anniversaries this year. Deutsche Beteiligungs AG (DBAG) is not only 50 years old, making it Germany’s oldest private equity firm, it can also look back on 30 years as a listed company – which is also unique for a German private equity company.

Over more than five decades, DBAG has invested equity of about 2.5 billion euros in more than 350 portfolio companies. Through the consistent implementation of its investment philosophy, which focuses on industrial business models in selected sectors of Germany’s “Mittelstand” with revenues of 50 to 500 million euros, DBAG has continually created value for its shareholders and the investors in its funds. The result is a return on net asset value of 15.3 percent over the past ten financial years (2004/05 to 2013/14) and a total return to its shareholders of more than 14 percent (1 October 2005 to 30 September 2015).

“DBAG has demonstrated over many years that, in its role as a partner, it can raise companies to new levels and create new prospects for them that would often be considerably more difficult to realise based on their own financial resources,” said Torsten Grede, Spokesman of the DBAG Board of Management, commenting on the anniversary. “It makes us proud to see that so many companies have developed sustainably with our equity and our support.”

Private equity pioneer in Germany

Over the years, DBAG has developed from a minority to a typical buyout investor. In September 1965, when Deutsche Bank founded Deutsche Kapitalbeteiligungsgesellschaft mbH (DBG), a predecessor of DBAG, the objective was to provide German mid-sized companies with the kind of equity financing that was already available in the US and UK. In Germany, companies had grown strongly in the economic boom years of the 1960s, but frequently found themselves limited by their lack of access to fresh capital.

It was only in the mid-1990s that the Company increasingly took majority positions alongside its managed funds. DBAG was one of the first to structure management buyouts in Germany – a transaction form that had long been common in Anglo-Saxon countries at the time.  For that purpose, the investment team was considerably expanded. Today, DBAG’s investment team consists of 23 professionals, twelve of whom have an average of more than 15 years of experience in private equity. With an in-depth knowledge of business models and longstanding expertise, DBAG approaches its portfolio companies as a “sparring partner” of equal standing. Since 1995, DBAG has successfully invested in 36 MBOs, of which 21 have been realised to date, thereby nearly tripling the invested capital (money multiple of 2.7).

In addition to its proactive management of investments, fund management and advisory services have been expanded over the years to become a second pillar of DBAG’s business, which today delivers consistent contributions to income. “International investors rely on our competency when they commit their capital to our funds for investment in Germany. The large number of investors who have invested with us across several funds attests to the confidence they have in us,” said Dr Rolf Scheffels, Member of the Board of Management.

Solid constant in the Prime Standard and S-Dax

Deutsche Beteiligungs AG has been listed on the Frankfurt Stock Exchange since 19 December 1985 and is now a solid constant in the Prime Standard and S-Dax. Boasting good returns, DBAG has proved to be an exceptionally profitable long-term investment both for investors, who invest their capital through DBAG funds, and for DBAG shareholders. Shareholders who have held their shares since the initial listing and continually re-invested their dividends in DBAG have achieved an annual return of ten percent across all cycles. DBAG shares also outperformed the market over a shorter period of time, increasing 275 percent over the last ten years, during which the Dax and S-Dax merely doubled.

Susanne Zeidler, CFO, commented: “Through its stock market listing, DBAG has provided a much broader audience with access to the asset class of private equity. Whereas most traditional private equity funds are almost exclusively open to institutional investors and wealthy individuals, DBAG is open to all classes of investors – earning returns that outperform the indices over the long term.”

2014/2015 financial year records positive performance again

For this 2014/2015 financial year that ended on 30 September 2015, DBAG substantiated its position by again recording positive performance. More than 300 million euros have been invested in seven new portfolio companies, of which 72 million euros came from the balance sheet of DBAG.