Why US investors are snapping up Germany's famed Mittelstand
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Increasing amounts of US capital are flowing into Germany's traditional industrial firms and family-owned businesses. As many business owners struggle to find successors, more companies are becoming acquisition targets.
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What do the long-established German companies Birkenstock, Viessmann, Linde and ebm-papst have in common? All have fallen into American hands.
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Traditional German family-owned businesses and small-to-medium-sized enterprises (SMEs) have become increasingly attractive to US companies and investors.
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Last year, US investors were involved in 76 acquisitions and investments in German industrial and manufacturing companies, according to an analysis by financial data provider PitchBook. The transactions were valued at about $29.5 billion (€26.3 billion) in 2025, nearly double the 2022 total. As of August 19, 2026, the figure stood at $23.9 billion.
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"From what we are seeing in the market, the interest from US investors in German companies is definitely still there," said Samar-Ahmad Albrecht-Mahmood of Veracity Capital Investments, which advises companies looking to invest in Germany.
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German companies, particularly those in the industrial and manufacturing sector, remain attractive, "because many of them are highly specialized, have strong customer relationships and very good technical know-how," he told DW. "In many cases, these are businesses that have built up a strong position in their niche over decades."
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At the same time, many German business owners are reaching an age where they are thinking about selling their business, Albrecht-Mahmood underscored, pointing out that "there is often no successor within the family."
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"This brings companies onto the market that might not have been available for sale a few years ago," he said.
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Notable takeovers this year include ebm-papst, the Mulfingen-based manufacturer of electric motors and fans, which was bought by US company Madison Air for $5.4 billion in August.
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In June, the long-established Augsburg-based company Everllence, formerly MAN Energy Solutions, was sold to Bain Capital, with the US investment firm acquiring a 51% stake in the company.
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According to Die Deutsche Wirtschaft (DDW), a German business information network focused on the Mittelstand (medium-sized and family-owned companies), no country owns more German firms than the United States. Of the total 7,861 companies identified in the database "German Companies Under Foreign Ownership," 1,750 are currently held by US investors.
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To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video PricewaterhouseCoopers (PwC), one of the world's leading auditing and consultancy organizations, also underscored the growing US investor interest in acquiring German companies.
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In a report, titled Destination Germany, PwC said that while the number of acquisitions and equity investments has not increased, the financial volume of the deals has jumped. The report highlighted, in particular, the acquisition of BASF Coatings by the US investment firm Carlyle, in partnership with the Qatar Investment Authority (QIA), for around €7.7 billion.
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The deal was struck on October 26, 2025, and closed on June 30 of this year.
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According to a recent survey by the American Chamber of Commerce in Germany, about 62% of the US companies active in the country are expecting business conditions to improve over the next three to four years.
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Meanwhile, some 52% of them are planning to expand their operations in Germany, up from 49% in 2024.
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To view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video At first glance, however, the increase in US acquisitions and equity investments does not seem to align with the decline in US investment flows to Germany last year.
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According to the Bundesbank, significantly less investment capital flowed from the US to Germany in 2025 than in the previous year.
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While foreign direct investment in Germany has risen overall — from €57.4 billion in 2024 to a total of €86.1 billion last year — investment from the US amounted to only €11.8 billion, nearly 44% less than in 2024.
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In contrast, investment from the United Kingdom rose to around €26 billion.
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"I would say the trend is continuing, although perhaps not simply in terms of higher deal numbers every year," Albrecht-Mahmood said.
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"The general interest in good German industrial companies, especially strong Mittelstand businesses, remains high."
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Relatively low valuations also play a role, the expert argued. "Compared to the US, we still see situations where German companies are valued more moderately, particularly in the SME segment.
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This can make acquisitions quite attractive for international buyers." This article was originally written in German.
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