Heckler & Koch undergoes new management:

The arms industry is experiencing a boom due to the ongoing Ukraine conflict, but one of its major players, Heckler & Koch, has seen a decline in its stock price in recent months. The financial company Erell LLC, based in Jackson, Wyoming, USA, has become the new indirect majority shareholder of the German arms manufacturer.

Erell LLC is associated with banker Philippe de Lavenere Lussan, who operates businesses in the tax haven of Barbados, and French investor Nicolas Walewski. The new ownership structure has been the subject of multiple changes in the past few months, with CDE, another financial holding owned by Walewski, previously announced as the majority shareholder in August 2020. However, there have been seven more announcements about the indirect ownership since then.

Despite the changes, Heckler & Koch has stated that there have been no material or personal changes in the company. The management attributes the low trading volume of the stock as a reason for its perceived undervaluation, and they believe the actual value of the H&K stock is much higher.

The order surge for Heckler & Koch is one of the largest in its history, with the start of serial production of the new G95A1 assault rifle for the Bundeswehr contributing to this increase. The company hopes to deliver several thousand of these new assault rifles to the Bundeswehr by the end of the year.

The order intake for Heckler & Koch in the first half of the year was 43% higher than the previous year, totaling 282.5 million euros. This increase in orders led to a revenue increase of almost five percent to 179.5 million euros, and a net income after taxes of 11.8 million euros, despite a fall of over eight percent.

However, the H&K stock has lost 56% of its value in a year, with a share costing 172 euros in March. Despite the arms industry reaching new highs, the H&K stock is trading at around 50 euros.

Despite the opaque and complex ownership structure, Heckler & Koch has maintained its operations and is looking forward to delivering its new assault rifles to the Bundeswehr. Further details about the new ownership structure, particularly from banker Lussan, have not been disclosed.