U.S.-based Madison Air Solutions agreed on Monday to acquire German airflow technology leader ebm-papst in an enterprise purchase price deal valued at $5.4 billion. The transaction aims to expand Madison Air’s global footprint and capitalize on booming data center cooling demand while integrating more than 1,200 patents.
The acquisition values ebm-papst at an effective enterprise price of $5.0 billion net of future tax savings, representing 14.6 times the target company’s forecasted 2026 adjusted EBITDA. When factoring in estimated annual run-rate synergies of $160 million by the third year, the multiple drops to approximately 10 times. On a euro-denominated basis, ebm-papst set the enterprise value at €5.1 billion, with the transaction expected to close around year-end subject to regulatory approvals and customary closing conditions.
Corporate Structure and Financing Details
Funding for the multi-billion-dollar transaction relies on a combination of cash on hand alongside debt and equity financing. Madison Air received a debt commitment letter from UniCredit and Wells Fargo for the debt portion of the acquisition financing. Pro forma net leverage at closing is expected to remain below 4 times, with management targeting a reduction to approximately 2.5 times within two years.
The deal involves ebm-papst’s three shareholder families—Sturm, Ziehl, and Philippiak—transferring their stakes to Madison Air. If the transaction ultimately fails to close, those family shareholders will receive a break-up fee of €250 million. Following the announcement, Madison Air shares experienced a pullback, dropping between 4% and 5% in Monday trading.
Tapping the Data Center Cooling Boom
The primary strategic catalyst behind the acquisition is the explosive growth in demand for advanced thermal management. As hyperscalers deploy increasingly powerful chips and servers, cooling infrastructure has become a critical bottleneck and a massive commercial opportunity. Equipment utilized in data centers operated by hyperscalers already accounts for approximately a third of ebm-papst’s sales.
The deal gives us access to the U.S. capital market, which can help us with strategic options, ebm-papst CEO Klaus Geissdoerfer told Reuters.
Headquartered in Mulfingen, southern Germany, and founded in 1963, ebm-papst employs more than 13,000 people worldwide—including approximately 5,800 in Germany—and has more than 250 million fans installed globally. The company reported revenue of €2.24 billion for the fiscal year ended in March, and the incoming ownership projects 2026 revenue to reach approximately $2.8 billion alongside roughly $343 million in adjusted EBITDA.
Leadership Perspectives and Operational Integration
Executives from both organizations emphasized that the merger pairs complementary strengths across North American and European markets.
“We’re excited about the opportunities this acquisition creates for our customers, employees and shareholders as Madison Air continues to expand our ability to deliver Return on Air and strengthen our position in attractive, growing markets.”
Jill Wyant, President and CEO of Madison Air
Madison Air expects the acquisition to be accretive to adjusted earnings per share in the first full year following closing.
Future Operations in Mulfingen
Despite the change in ownership, ebm-papst will maintain its corporate headquarters in Mulfingen, Germany, along with its core research, development, and production operations. Company leaders confirmed that the transaction will not affect existing employment law obligations, collective bargaining agreements, or shop agreements.
“Since our founding more than six decades ago, ebm-papst has built a reputation on engineering excellence, innovation and earning the trust of our customers. Madison Air shares that philosophy and has demonstrated a long-term commitment to supporting entrepreneurial businesses.”
Klaus Geißdörfer, CEO of ebm-papst
