Target Information

HvS-Consulting AG, founded in 2002 and headquartered in Garching near Munich, is a leading consulting boutique specializing in Cyber Security. The firm supports international corporations and SMEs across all aspects of IT security, offering consulting services, assessments, and incident response. Under its product brand IS-FOX, HvS also provides training and e-learning courses focused on Cyber Security, data protection, and compliance. With a workforce of over 50 employees and a network of specialized partners, HvS serves over 500 clients, including nearly half of all DAX-listed companies and hundreds of medium-sized enterprises.

Industry Overview in Germany

The Cyber Security industry in Germany has seen significant growth due to increasing concerns over data protection and regulatory compliance. As cyber threats continue to evolve, organizations are prioritizing IT security to safeguard sensitive information from potential breaches. This demand has driven investment and innovation within the sector, positioning Germany as a leader in Cyber Security solutions in Europe.

Furthermore, the heightened regulatory landscape, including regulations such as the General Data Protection Regulation (GDPR) and the IT Security Act, has intensified the scrutiny on companies regarding their data handling practices. Firms must now adopt comprehensive security measures to avoid substantial fines and reputational damage. This environment creates substantial market opportunities for highly specialized consultancies like HvS.

Moreover, Germany’s robust industrial base provides a fertile ground for Cyber Security consultancies. As companies navigate the digital transformation, there is an increasing reliance on technology, making security indispensable. Thus, the synergy between Cyber Security needs and the growing digital landscape enhances prospects for consultancy growth.

Overall, the Cyber Security sector in Germany remains dynamic, driven by continuous advancements in digital technology and increasing regulatory requirements, enabling firms like HvS to thrive and expand their services effectively.

Rationale Behind the Deal

The acquisition of a majority stake in HvS by NORD Holding Small Cap Fonds (NSC) is strategic, aiming to enhance HvS’s market position as a top-tier Cyber Security consultancy in the German-speaking region. NORD Holding's involvement is expected to bolster the company's successful growth trajectory achieved over recent years. The founders, Michael Hochenrieder and Frank von Stetten, will retain significant stakes and continue to lead the operational aspects of the firm, ensuring continuity in leadership and vision.

This partnership is expected to enable HvS to explore new market opportunities while fortifying its existing service offerings in response to the growing urgency for Cyber Security solutions among enterprises.

Information About the Investor

NORD Holding is an investment firm that focuses on small-cap companies, emphasizing growth strategies and value creation. With a reputation for fostering dynamic enterprises, NORD Holding aims to partner with companies that demonstrate strong potential for growth. The firm not only provides financial support but also strategic insight and operational guidance to enhance business development.

Jan Markus Drees, a partner at NORD Holding, expressed enthusiasm for the acquisition, praising the founders for establishing HvS as a quality leader in Cyber Security services. NORD Holding’s robust experience in developing businesses positions them well to support HvS as it scales and captures additional market opportunities.

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This acquisition can be considered a sound investment due to the substantial growth potential in the Cyber Security sector. With the increasing complexity of cyber threats and the mounting legal obligations for data protection in Germany, companies are likely to continue prioritizing Cyber Security services. HvS’s established client base, which includes numerous DAX companies, signifies its credibility and market leadership.

Furthermore, the commitment from the founders to remain actively involved in the company’s operations ensures the preservation of their vision and operational integrity. This is crucial, as their knowledge and expertise have driven HvS’s success in the past. The backing of NORD Holding can amplify their existing momentum, enabling them to expand their service offerings and strengthen their market position.

Moreover, the prospect of integrating potential acquisitions into HvS’s strategy presents additional growth avenues. As the Cyber Security landscape evolves, consolidating other specialized firms can further enhance HvS’s service breadth and depth, catering to the diverse needs of their clientele.

Overall, this deal appears to align well with industry trends and the strategic objectives of both parties involved, potentially making it a lucrative investment for NORD Holding and a catalyst for ongoing growth for HvS.

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