Rhinemetall's Comprehensive Geographical Overview
Rheinmetall, the German defence and automotive conglomerate, is in the midst of discussions regarding the potential sale of its automotive business. The primary contender for this division is One Equity Partners (OEP), a U.S.-based private equity firm [1][3].
The sale is part of Rheinmetall’s broader strategy to focus exclusively on its defense business, given the rising global military spending and stronger performance in its defense segments. The Power Systems division, serving automotive and thermal management needs, has underperformed relative to Rheinmetall’s defense operations, with margins decreasing and challenges from delayed EV adoption and strict EU emissions regulations playing a role [1].
Rheinmetall’s CEO, Armin Papperger, has confirmed that there is significant interest in the sale of the company’s civilian division. He emphasised that a sale will only proceed if the offer is satisfactory and the future of the employees is secured [2]. The shift in focus to the defense business is expected to further improve Rheinmetall’s margins.
Latest Updates on the Sale
Rheinmetall confirmed it is actively considering the sale of its Power Systems division to One Equity Partners. The transaction, if successful, is expected to unlock value and sharpen Rheinmetall’s focus on defense technologies such as military vehicles, advanced munitions, and cybersecurity [1][3].
No official completion date for the sale has been disclosed yet, but reports from mid-July 2025 confirm ongoing discussions and positive signals from the company about the divestiture process [3]. The management of Rheinmetall has long stated that the civilian business no longer aligns with the core business of the Düsseldorf-based company.
The potential interest of financial investors, such as One Equity Partners, underscores the potential seen in restructuring Rheinmetall's civilian division. The sale is reminiscent of the sale by another German company, Renk.
For those interested in broadening their engagement, there is an option to opt for a certificate on the European Defense Index, which includes 17 other European defense companies in addition to Rheinmetall [4]. The European Defense Index values and suitable certificates can be found at the provided link.
[1] - Reuters
[2] - Bloomberg
[3] - Handelsblatt
[4] - European Defense Index
The sale of Rheinmetall's Power Systems division to One Equity Partners, if completed, could unlock value and sharpen Rheinmetall's focus on defense technologies. The potential interest of financial investors, such as One Equity Partners, underscores the potential seen in restructuring Rheinmetall's civilian division, suggesting a shift in finance priorities.
