GMARS.
DÜSSELDORF / MUNICH — In a move that cements its transition from a dual-focus industrial giant into a dedicated defense powerhouse, Rheinmetall AG has officially signed an agreement to divest its civilian Power Systems division to Munich-based industrial group AEQUITA.
The deal, valued at a provisional purchase price of €350 million, marks the final major step in Rheinmetall’s multi-year strategy to exit the automotive supply chain and pour its resources into the rapidly expanding global defense and security sectors.
The transaction is expected to close in the fourth quarter of 2026, pending standard regulatory approvals.
A Strategic Pivot to the Frontline
For over a century, the Düsseldorf-based DAX 40 company has balanced its identity between civilian engineering and military hardware. However, a surging global demand from military customers and security agencies has prompted Rheinmetall to narrow its scope. By shedding its civilian legacy, the group is aggressively expanding its technological footprint across land, air, sea, and space domains.
Armin Papperger, Chairman, Rheinmetall.
“This is a significant milestone in the company’s history,” said Armin Papperger, CEO of Rheinrmetall AG. “We are focusing on the high-margin business with military customers, where we have excellent growth opportunities. Our stated objective was to place our civilian business operations in capable hands. We have found an excellent buyer in AEQUITA.”
The Power Systems division, which includes long-established and highly regarded automotive brands like Pierburg, Kolbenschmidt, and Motorservice, generated approximately €2 billion in sales in 2025. Rheinmetall had already flagged the division as a “discontinued operation” in its late 2025 financial reporting, following earlier sales of its piston operations in 2023 and 2024.
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AEQUITA Expands Automotive Footprint, Guarantees Jobs
For the Munich-based holding company AEQUITA, the acquisition represents a massive scaling opportunity. Specializing in corporate spin-offs and industrial transformations, AEQUITA’s portfolio already spans the automotive, chemical, and industrial sectors, bringing in over €10 billion in revenue.
With the addition of Power Systems, AEQUITA’s automotive division alone will balloon to roughly €5 billion in revenue. Crucially for the workforce, AEQUITA has committed to retaining all of the approximately 6,250 employees currently working within the division globally.
“The company is an excellent addition to our Automotive portfolio,” stated Dr. Axel Geuer, Chairman and Co-CEO of AEQUITA. “In the years to come, our focus will be on actively supporting the long-term, successful, and sustainable development of the company, while realizing synergies within our automotive portfolio.”
The division will operate as an independent entity under AEQUITA, keeping its existing trademark rights and continuing to supply the market under its legacy brand names.
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The Fine Print: What Stays with Rheinmetall
While the sale represents a near-total exit from automotive manufacturing, Rheinmetall is keeping a few specific assets under its wing for strategic reasons:
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KS Huayu AluTech GmbH: The three German manufacturing sites (Neckarsulm, Walldürn, and Langenhagen) will remain within the Rheinmetall Group as a joint venture in the medium term.
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Dermalog SensorTec GmbH: This stake will be permanently retained by Rheinmetall and integrated directly into its Weapon and Ammunition division.
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Abadiano Plant (Spain): The Pierburg S.A. plant in Spain will be kept along with its workforce. It will temporarily operate as a “hybrid” facility, manufacturing both civilian and military components, until it is completely transitioned into a military-focused production site.
Two Giants, Divergent Paths
The finalization of this deal highlights a clear trend in European industry: corporate streamlining. AEQUITA doubles down on its expertise in navigating the changing tides of the European automotive supply sector, aiming to unlock new profitability through innovation and agility.
Meanwhile, Rheinmetall—which boasts a €9.9 billion revenue profile for 2025 and employs 34,000 people worldwide—is now free to dedicate its entire capital and engineering prowess to the defense sector. As defense budgets across Europe and the globe continue to climb, Rheinmetall is officially all-in on the security business.
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