Overview of in-tech GmbH

in-tech GmbH, headquartered in Garching near Munich, is a prominent technology company specializing in engineering services and software solutions. Founded in 2002, in-tech has demonstrated significant growth over the years, establishing itself as a key player in the automotive sector. The company offers technological and organizational advisory services, as well as engineering services that are critical in the development of electronic components for vehicles and various transport systems.

With a strong emphasis on innovation, in-tech’s engineers and software developers engage in the entire development lifecycle of electronic components, from conception and testing to validation. Approximately 90% of in-tech's revenue is derived from the automotive industry, focusing on critical service areas such as electronics integration, driver assistance systems, connected vehicle solutions, infotainment systems, and electric mobility.

Industry Landscape in Germany

The automotive industry in Germany serves as a global benchmark for technological advancements and innovation. It is characterized by a robust demand for high-quality engineering and IT services, driven by the ongoing transition towards autonomous driving, electrification, and shared mobility solutions. This paradigm shift has led to a sigificant increase in investments in the digitalization of automotive technologies, fostering a strong competitive environment among industry players.

In recent years, the industry has experienced double-digit growth rates due to these technological trends, which in turn have accelerated the need for comprehensive hardware, software, and testing services. The substantial investments in Research & Development (R&D) reflect the commitment of automotive firms to adapt to market dynamics and consumer expectations, aiming for greener and smarter mobility solutions.

Germany's extensive automotive supply chain, comprising numerous SMEs and large manufacturers, plays a crucial role in sustaining the industry's vitality. Furthermore, the country benefits from a highly skilled workforce and established infrastructure, enhancing its position as a leader in automotive engineering and technology services.

Additionally, the rise of connected and electric vehicles has opened new avenues for growth within the sector, presenting opportunities for companies like in-tech to expand their service offerings and client bases. The emphasis on innovation and efficiency positions the German automotive landscape as fertile ground for technological advancements, ensuring sustained demand for specialized engineering services.

Rationale Behind the Investment

This management buyout (MBO) represents the sixth investment from DBAG Fund VIII, highlighting the fund's commitment to investing in mid-market companies within the DACH region. The acquisition of in-tech aligns strategically with DBAG's goal to capitalize on the burgeoning demand for connectivity and smart mobility solutions in the automotive industry.

DBAG plans to invest approximately 15 million euros alongside the fund, securing a 15% ownership stake in in-tech. The founders will retain a non-controlling interest, enabling them to continue steering the company’s strategic direction while leveraging DBAG’s expertise to enhance long-term growth and market reach.

About Deutsche Beteiligungs AG

Deutsche Beteiligungs AG (DBAG) is a leading private equity firm based in Germany, known for its focused investment strategy in mid-sized companies across various sectors, particularly in the DACH region. DBAG Fund VIII, operating since 2020, aims to provide strategic capital and management support to its portfolio companies to foster sustainable growth.

With a strong track record of successful investments and a keen understanding of the automotive services market, DBAG is poised to leverage its resources and expertise to bolster in-tech’s expansion plans. The firm’s proactive approach, particularly in pursuing add-on acquisitions, underscores its commitment to enhancing the value proposition of its investments.

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The recent acquisition of in-tech GmbH by DBAG Fund VIII appears to be a promising investment strategy, tapping into the growth potential of the automotive technology sector. The ongoing trends of digitalization, electrification, and the development of connected vehicles provide a favorable backdrop for in-tech's service offerings.

DBAG's plan to facilitate further acquisitions can significantly enhance in-tech's market presence, enabling the company to diversify its clientele beyond the automotive industry. This strategic focus is particularly advantageous in a rapidly evolving market, where diversification can mitigate risks associated with dependence on a singular sector.

Moreover, in-tech's demonstrated revenue growth and successful scaling of operations, coupled with a strong commitment to innovation, reinforce the viability of this investment. The continued investment in R&D and expansion into international markets aligns well with the overarching goals of DBAG Fund VIII.

Overall, this investment not only positions DBAG to capitalize on in-tech's existing achievements but also provides a strategic pathway for future growth avenues, ultimately enhancing shareholder value and solidifying in-tech’s reputation as a key player in the automotive services ecosystem.

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