Buy a Business in Germany
Foreign buyers who want to buy a business in Germany face a supply problem, not a capital problem. Most owner-run companies are sold quietly and never reach a buyer abroad; FISART sources them off-market for you.
Key takeaways
- Germany's succession wave is measured: 186,000 companies with about 3 million employees are due for a handover between 2026 and 2030, and the share going to external buyers is 29 percent (IfM Bonn, November 2025).
- The constraint for a foreign buyer is access. Owner-run Mittelstand companies sell through local networks, in German, often without a formal process.
- A non-EU buyer may face a foreign investment review from 25 percent of voting rights, or from 20 percent in listed technology sectors and 10 percent in critical infrastructure. A separate 10 percent review covers defence and classified IT security and applies to every foreign buyer, including buyers from the EU. The review is a filing and a timeline, not a ban.
- German owners decide on trust before price. Who will run the company, what happens to employees and whether the buyer understands the business decide whether the first call leads to a second.
- FISART runs scoped buy-side searches in Germany on a retainer-plus-success-fee model and hands over owners who have confirmed their intent to sell.
Last updated: November 2026 · Byline: Lud Schroedl
Focus
Owner-run companies, lower-middle market
Coverage
Germany, with Austria and Switzerland on request
Buyer types
PE platforms, strategics, search funds, holdcos
Model
Retainer plus success fee
Why do German owner-run companies rarely reach foreign buyers?
Most German companies that change hands are not for sale in any visible sense. The Institut für Mittelstandsforschung Bonn estimates that about 186,000 companies will be handed over between 2026 and 2030 because their owners leave for personal reasons, mostly age. Roughly a third of those handovers are in manufacturing, another third in business services and a fifth in trade. Meta-analyses of the last 40 years show that just over half of family businesses stay in the family, about 17 percent go to employees and 29 percent are sold to outsiders.
The owners are getting older faster than successors appear. KfW Research reports that 57 percent of Mittelstand owners were 55 or older in 2025, three points more than a year earlier, and that the average owner is now over 54, up from 45 in 2003. Owners who want to hand over within two years are on average 66.5 years old. Asked what makes a succession hard, 69 percent name the same thing: finding a suitable successor. That is the demand side of the market a foreign buyer is entering.
What keeps these companies away from foreign buyers is not law. It is how they are sold. An owner who has run a company for 30 years talks to his tax advisor, his bank and a few people he trusts. If a buyer appears, it is usually a competitor or a local group. The owner rarely runs a structured process, rarely appoints an international advisor and almost never answers an unsolicited email from a fund he has not heard of. The companies exist in the Handelsregister and in databases, and the owners still do not respond.
What do German owners expect from a foreign acquirer?
German owners judge a buyer on three questions before they look at price. Who will run the company after closing, what happens to the people, and does the buyer understand what the company actually does. A buyer who answers those three clearly in the first conversation gets a second one. A buyer who opens with a valuation range or a fund thesis usually does not.
Several things that are normal in a US or UK process read as warning signs in Germany. Pressure on timing, a long list of information requests before any meeting, a term sheet before anyone has visited the site, and a deal team that changes from call to call all cost trust. The owner expects to meet the person who will make the decision, to see the buyer's plan for the workforce in writing, and to hear a German-speaking counterpart explain the process in his terms.
Price matters, but later. KfW Research reports that the average asking price of a Mittelstand owner planning a succession between 2025 and 2029 is about 499,000 euros, which says less about the targets a foreign buyer wants than about the breadth of the market: most German handovers are small. The companies in the lower-middle market, with professional management and a few million euros of earnings, are the exception, and their owners know they have options.
Which buyer types acquire in Germany, and what does each need?
The buyers FISART works with share one trait: a clear mandate to deploy capital in Germany and no sourcing team on the ground. The gap looks different for each type.
| Buyer type | What they acquire in Germany | Where the gap is | How FISART helps |
|---|---|---|---|
| PE platform | Add-ons for a portfolio company | Database targets are overrun; owners do not answer | Owner-level origination in German, warm handover |
| PE fund without a German platform | A first platform | No local network, no track record German owners recognize | A scoped search before the first deal, in-market presence |
| Corporate strategic | Market entry or a capability | Decision sits abroad, local credibility is thin | A German-speaking counterpart for the owner, first meetings |
| Search fund or holdco | One company to own and run | Small team, long search, limited budget | Pre-screened owners who match the thesis |
| Family office | Direct, long-hold investments | Discretion, no visible process | Quiet, off-market introductions |
If your profile is not in the table, submit your criteria anyway. The buy-box tells us more than the label.
Which rules apply when a non-EU buyer wants to acquire a company in Germany?
German company law does not restrict foreign ownership. A foreign company or fund can acquire a company in Germany and hold 100 percent of a GmbH without a local partner, and there is no citizenship or residency requirement for shareholders. Three things can still affect, or in rare cases block, a deal: EU sanctions, which can prohibit a transaction with a listed party outright; the German foreign investment review; and merger control. The last two are filings with a clock.
The first is the foreign investment review under the Foreign Trade and Payments Act and Ordinance (AWG and AWV). The Federal Ministry for Economic Affairs and Energy can review any acquisition in which a buyer from outside the EU and EFTA reaches 25 percent of the voting rights in a German company. The threshold drops to 20 percent for a list of sensitive technologies such as AI, semiconductors and quantum computing, and to 10 percent for critical infrastructure and a small number of comparable sectors (AWV section 56, with the list in section 55a). A separate review covers defence and classified IT security products: it starts at 10 percent and applies to every foreign buyer, including buyers from the EU (AWV sections 60 and 60a). A filing is mandatory in the listed sectors; elsewhere the ministry can still open a review on its own initiative, so buyers often apply for a certificate of non-objection to get certainty (AWV section 58). Follow-on acquisitions by an existing investor can trigger a new review, at 40, 50 and 75 percent in the ordinary case and at lower steps in the listed sectors (AWV section 56 paragraph 2). Where a filing is mandatory, closing before clearance is legally ineffective.
In October 2026 the ministry circulated a draft Investitionsprüfgesetz that would consolidate these rules in one statute, merge the 20 percent category into 25 percent, introduce a 15 percent threshold for listed companies, and treat buyers from Switzerland, Norway, Iceland and Liechtenstein as non-EU buyers for the first time. As of November 2026 it is a draft, not law. Check the status before you plan a timeline around it.
The second regime is merger control. The Bundeskartellamt must be notified when the combined worldwide turnover of the parties, counted with their whole groups, exceeds 500 million euros, one party has more than 50 million euros of German turnover and another more than 17.5 million euros. Most lower-middle-market acquisitions fall below these thresholds. A separate threshold catches very large deals with little German turnover, where the price exceeds 400 million euros and the target is significantly active in Germany (GWB section 35 paragraph 1a). Buyers of a bank, payment institution or insurer also need the owner-control approval of the financial supervisor from 10 percent, whatever their nationality (KWG section 2c, VAG section 17).
Neither regime is aimed at an owner-run company in a normal industry, and restrictions are rare. Both are filings with a clock. Where a filing is mandatory the law itself suspends the closing until clearance, so the review belongs in the conditions precedent of the purchase agreement rather than in a surprise after signing.
This section describes the rules in general terms and is not legal advice. Engage German counsel for your transaction.
How does a German acquisition run from criteria to closing?
A FISART buy-side search in Germany runs in six steps. The first three are where most foreign buyers lose time when they search alone.
- 01
Criteria
We define the buy-box with you in a short workshop: sector, size, region, deal type, what you will not buy. The criteria go into the mandate and define what counts as a target.
- 02
Origination
We reach German owners who fit the criteria directly, in German, through channels that do not depend on the owner being on a list. Most of them are not in any process.
- 03
Qualification
An owner becomes a target when he has confirmed his intent in conversation, passed a short review of the business and agreed to be introduced to you. You receive qualified owners, not names.
- 04
Introduction
We prepare the first meeting on both sides and sit in it. The owner meets the person who decides, in a setting he is comfortable with.
- 05
Terms
We support the letter of intent and the structure, and we flag the German points early: notarization of a share purchase, employee transfer rules, the investment review, the works council.
- 06
Closing
We stay in the process through due diligence and signing and coordinate with your German counsel, your tax advisor and the notary.
The German side of this process takes longer than the paperwork suggests, and most of that time is spent before step three. An owner who has decided to sell to you is a different negotiation from an owner who has agreed to a meeting.
What do US, UK and Asian buyers ask first?
US buyers
US private equity and strategics usually ask about price and process first. The short answer is that lower-middle-market companies in Germany are sold in bilateral negotiations far more often than in auctions, and that a buyer who can operate a company of this size gets more company per dollar than at home. The longer answer, including structure, financing and the full path from buy-box to closing, is in our guide for US buyers acquiring in Europe.
UK buyers
UK buyers have been non-EU buyers for the purposes of the German investment review since 1 January 2021, when the Brexit transition period ended (AWV section 55 paragraph 1). The UK is in fact one of the largest sources of filings, though restrictions on UK deals are rare. What UK buyers underestimate more often is the formality of German deal mechanics: a GmbH share transfer is notarized, and employees in an asset deal transfer with their contracts and a right to object.
Asian buyers
The review turns on the target's sector and on who ultimately controls the buyer, including whether a foreign state does (AWV section 55). It is not aimed at any one country: on the ministry's own figures the largest sources of filings are the United States and the United Kingdom. The practical questions are the same for every foreign buyer, with two additions: a German holding company as the acquisition vehicle is usually advisable, and the owner will want to meet the people who will run the company in Germany, not only the investor. We prepare that meeting.
How does FISART work with buyers in Germany?
FISART is an M&A advisor for foreign buyers in Germany, on the buy side. We do not list companies and we do not sell targets to several buyers at once. A mandate is scoped to a sector and a region, runs on a monthly retainer that is credited against a success fee paid on completion, and defines what a qualified target is before the search starts.
Our founder has built and sold two companies of his own and sits across the table from German owners as one of them. That is not a credential for a pitch deck; it is the reason the first conversation with an owner happens at all.
If you want to understand the role in general before you talk to us, read what a buy-side advisor does and when hiring one is worth it, and how a European acquisition pipeline is built. If you are ready, submit your criteria below.
Submit your acquisition criteria
Tell us what you are looking for in Germany and we will come back with how we would run the search. The more specific the buy-box, the faster we can surface owners who fit.
- A senior advisor reviews your criteria and replies within 48 hours
- German-speaking origination, owners who have confirmed their intent
- Retainer credited against the success fee
Prefer to talk first?
Book a call with a senior advisorFrequently asked questions
Sources
- 1.IfM Bonn (2025): Unternehmensnachfolgen in Deutschland 2026 bis 2030, Daten und Fakten Nr. 37, Bonn, November 2025. Link
- 2.KfW Research (2026): Nachfolge-Monitoring Mittelstand 2025, Fokus Volkswirtschaft Nr. 526, January 2026. Link
- 3.KfW Research: Nachfolge im deutschen Mittelstand (topic page, asking price and age figures). Link
- 4.Federal Ministry for Economic Affairs and Energy: Investitionsprüfung (foreign investment review). Link
- 5.Außenwirtschaftsverordnung (AWV), sections 55 to 62, gesetze-im-internet.de. Link
- 6.Gesetz gegen Wettbewerbsbeschränkungen (GWB), section 35, gesetze-im-internet.de. Link
- 7.M&A Review (2026): Investitionsprüfungsgesetz: neue Schwellen und ein neuer Investorenbegriff für ausländische Käufer, 10 October 2026. Link
Figures as of November 2026. Legal thresholds describe the law in force on that date.
Published: October 29, 2026. Updated: November 1, 2026.
Byline: Lud Schroedl.
Ready to source in Germany?
Submit your acquisition criteria or book a call with a senior advisor to discuss how we would run the search for you.