Greek company Theon acquires German Kappa Optronics to increase production of military optics across Europe.

On August 4, 2025, Theon International Plc announced the acquisition of 100% of the German company Kappa Optronics GmbH for an enterprise value of €75 million. This transaction, financed through a mix of debt and proceeds from the company’s February 2024 IPO, marks Theon’s fourth consecutive industrial investment in Germany.
Follow Army Recognition on Google News at this link

The acquisition of Kappa Optronics allows Theon to broaden its product portfolio, particularly in electro-optics for land and aerial platforms, which are core to its future growth. (Picture source: Kappa Optronics)

It follows previous investments in Harder Digital and Andres Industries and the opening of Theon Germany’s facility in Wetzlar under a joint venture with Hensoldt. The deal is subject to customary regulatory approvals and has been supported by PwC for financial and tax due diligence and by Bird & Bird for legal review and transactional assistance. Kappa Optronics specializes in aviation and land optronics, with a strong focus on platform-based products. The acquisition is intended to support Theon’s global expansion and strengthen its existing product offering in defense mobility and autonomous systems. Theon expects the acquisition to be accretive and to enable sales growth in 2026, while also increasing the company’s engineering capacity and facilitating new business development activities across Europe.

Kappa Optronics GmbH was founded in 1978 and is headquartered in Göttingen, Germany. It operates under an R&D-oriented, asset-light model, covering design, assembly, quality assurance, management, and administration functions. The company employs approximately 200 people, including 60 engineers, and maintains subsidiaries in the United States and Spain. Its operations span around 3,000 square meters. Kappa is projected to generate over €37 million in revenue for fiscal year 2025 and an EBITDA of around €8 million, driven primarily by demand in defense mobility and autonomous platforms. The company’s current management will remain in place under a performance-based incentive structure. Theon expects that Kappa’s EBIT margin can be brought into the mid-twenties range in the short term to align with group financial targets. Theon's guidance for 2026, expected in October, will include this acquisition and reflect updated revenue and margin trajectories, depending in part on several large tender awards the company is currently competing for.

Theon considers this acquisition consistent with its strategic priorities. It provides additional presence in Germany, where the company is already active, and introduces a direct industrial entry point into Spain, a NATO and EU member state. Theon intends to use this presence to support future production of its main systems in these countries. The integration of Kappa is expected to expand Theon’s electro-optics portfolio, particularly for land and aerial platforms. The acquisition will also contribute to enhanced research and development capabilities, combining Kappa’s engineering base with Theon’s existing Athens-based team of approximately 80 engineers. Theon expects to realize product co-development opportunities, sales synergies, and technical knowledge sharing across the group. The Kappa premises in Göttingen, the QUADBOX Driver Vision Enhancement system, and visual system components for MRTT aircraft are expected to be integrated into Theon’s wider portfolio, including its A.R.M.E.D. product line. Kappa’s current infrastructure is already well-invested and does not require capital expenditure beyond the existing financial framework of Theon.

This transaction follows the establishment of Theon Belgium, announced on July 29, 2025, which included the creation of a 100% owned subsidiary and a new production facility in Zaventem, near Brussels. The new plant, located in the Ikaros Business Park, spans 420 square meters and is planned to support local production, exports, and future R&D integration. A Belgian national has been appointed as plant manager, responsible for launching operations and overseeing the recruitment of up to 12 employees during the initial phase. Theon Belgium is intended to serve as a production and coordination hub for EU and NATO-related programs. Simultaneously, Theon invested €1.1 million to acquire a 10% stake in Berlin-based Andres Industries AG, with an option to raise its stake to 24.99% within two years for a total of €4.5 million. Theon also relocated its German headquarters to Berlin, into the Andres Industries premises. This move is distinct from Theon’s broader M&A strategy but supports operational alignment with Andres Industries, with whom Theon has already participated in tenders, including the IRIS thermal imaging system, procured by the German Bundeswehr through a Bundestag-approved initial order of 4,375 units worth €49 million.

Theon’s broader operational and financial context shows a pattern of growth through both organic and inorganic means. The company completed its listing on Euronext Amsterdam in February 2024, raising €154 million gross at €10 per share. In June 2025, a follow-up placement of 3.73 million shares, representing 5.3% of the company, was completed at €31.1 per share. This increased the free float to around 30%, while the remaining shares are held by Venetus Limited and CHRE Investment Limited, controlled by Theon CEO Christian Hadjiminas. By March 2025, Theon reported a soft backlog of €668.6 million, up from €654 million at the end of 2024, and net cash of €61.2 million. Revenue for the first quarter of 2025 reached €90.8 million, a 19.8% year-on-year increase, and adjusted EBIT stood at €23 million. For full-year 2025, Theon forecasts revenue between €410 and €430 million, with capital expenditures expected to reach €20 million. In April 2025, the company announced a proposed dividend of €0.34 per share, representing a 35% payout ratio of 2024 net income, subject to shareholder approval.

Product development continues across several lines. Theon has more than 220,000 systems in service in 71 countries, including 26 NATO member states. Its offerings include night vision binoculars, clip-on weapon sights, thermal imagers, ISR systems, driver viewers, and fusion-enabled optics. Recent additions to its portfolio include the Iris thermal clip-on system and the Orion binocular system, both part of the A.R.M.E.D. suite. Iris fuses thermal and image intensification data and integrates with battle management applications such as ATAK. It is compatible with Theon’s Mikron goggles, which are widely fielded in the Bundeswehr. A related system, the TRITON family, targets maritime surveillance, while the TALOS line supports border monitoring and land-based ISR missions. Theon continues to pursue commercial agreements and industrial partnerships, including with Safran-Vectronix in Switzerland and Elbit Systems of America. In 2024, Theon also acquired Harder Digital to internalize supply chain components and signed an agreement with Exosens to stabilize sensor procurement. In 2025, the company initiated procedures to join the UN Global Compact and was again included in the Financial Times list of Europe’s 1,000 fastest-growing companies.

The acquisition of Kappa Optronics fits into Theon’s ongoing strategy, branded THEON NEXT, which aims to increase the share of digital and augmented optical systems in the company’s annual revenue mix. The group targets raising the proportion of A.R.M.E.D. product-related revenue from below 10% in 2025 to approximately 20% in 2026, with the long-term goal of deriving half of total revenue from systems beyond traditional night vision. Recent developments, including the establishment of Theon Belgium and the partial acquisition of Andres Industries, support this trajectory. Theon’s Deputy CEO Philippe Mennicken has described these moves as consistent with European Defense Industry Integration objectives. CEO Christian Hadjiminas has stated that upcoming announcements over the next two to three months will further align with this strategic orientation. Through the acquisition of Kappa and related investments, Theon aims to support a defense industrial base that enables multinational cooperation within the European Union and NATO structures. These moves are intended to enhance platform-level product development and production capabilities, while reinforcing industrial links among key European defense actors.