Information on the Target

The WMS Wachstumsfonds Mittelstand Sachsen has acquired 90% of the shares of IMM electronics GmbH, headquartered in Mittweida, through a joint acquisition holding alongside the three managing directors. The remaining 10% is held by the founding shareholder, Prof. Detlev Müller, who established the company after reunification and intends to maintain a connection with the organization in the future.

IMM electronics GmbH is a medium-sized enterprise specializing in electronic contract manufacturing (EMS). The company offers a comprehensive range of services, from hardware and software development to prototyping and series production of complete devices and assemblies. As a globally active and innovative electronics service provider, IMM prides itself on mastering the entire value chain, from conception and development to manufacturing. With approximately 132 employees, the company generates an annual revenue exceeding €20 million.

Industry Overview in Germany

The electronic contract manufacturing (EMS) sector in Germany has experienced robust growth driven by increasing demand for high-tech solutions in a variety of applications. This surge is particularly attributed to the rise of interconnected devices and the Internet of Things (IoT), as well as advancements in smart home technology and energy modernization efforts. The industry's dynamism is characterized by a shift towards localized production, reversing decades of outsourcing to Asia.

Germany's strategic position in Europe, coupled with a strong engineering base and skilled workforce, enhances the potential for further growth in the EMS market. Recent trends indicate that companies are now prioritizing supply chain resilience and agility, prompting many to reconsider their manufacturing decisions and potentially relocate production closer to their end markets.

Moreover, the EMS sector is expanding its footprint in highly regulated industries, including medical technology, where innovation and quality are paramount. This segment is witnessing significant investment as companies seek to leverage advanced engineering capabilities to develop cutting-edge medical devices and solutions.

Overall, the German EMS market is projected to continue its upward trajectory, driven by technological advancements and the increasing integration of smart technologies across various industries.

The Rationale Behind the Deal

The acquisition by WMS offers strategic advantages, enabling IMM to capitalize on the growing demand within the EMS industry. With a focus on localization and the increasing importance of the medical technology sector, WMS sees considerable promise in IMM's capabilities, notably its engineering and development expertise.

This investment aligns with WMS's mission to support Saxon mid-sized companies by providing both equity and expertise during periods of transition, such as shareholder changes and growth initiatives. By partnering with experienced management, WMS aims to navigate the future successfully and enhance IMM's market position.

Information About the Investor

The WMS Wachstumsfonds is committed to supporting the Saxon middle class and has been offering equity capital and know-how to businesses in the Free State since 2005. The fund specializes in financing transitions, including shareholder changes and both organic and inorganic growth strategies. IMM represents the tenth investment from the fund's third generation.

Harald Rehberg, managing director at WMS, emphasizes the ongoing dynamism in the German and European EMS markets, driven by technological advancements and increasing connectivity. WMS leverages its experience and resources to foster the growth of its portfolio companies, providing them with the necessary tools to thrive in a competitive environment.

View of Dealert

The investment in IMM electronics GmbH appears to be strategically sound, given the positive outlook for the EMS sector in Germany. With trends indicating a shift towards localized manufacturing and growing opportunities in medical technology, the timing for this acquisition is advantageous.

IMM's established presence in the market, combined with its commitment to innovation and high-quality service delivery, positions it well to capture potential growth opportunities. The experienced management team will play a crucial role in steering the company through potential challenges and market dynamics.

Furthermore, WMS's backing provides IMM with the necessary support to expand its operations and refine its offerings, particularly in high-potential sectors such as medical technology. This strategic alignment is likely to enhance IMM's competitive advantage and long-term sustainability.

Overall, this investment could yield significant returns, making it a promising venture as both IMM and WMS focus on leveraging their collective strengths to navigate the evolving landscape of the EMS industry.

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