European firms in the defense and technology sectors are increasingly cautious about potential American acquisitions, as governments seek to enhance their independence from the United States. According to the Financial Times, some companies are discouraging American bidders due to concerns over governmental opposition.
American investors are interested in acquiring several defense companies operating in Europe, but their efforts face resistance from current owners. For instance, Parcom, the owner of the Dutch company Robin Radar, has reportedly deterred U.S. arms manufacturers from submitting bids in a sales process due to the risk of governmental backlash. Sources indicate that Parcom would prefer to attract a strategic European investor or a private equity fund instead. The company is valued at a minimum of $2 billion and has already received multiple purchase offers, though it declined to comment to the FT.
In May, the Dutch government blocked the acquisition of cloud services provider Solvinity by the American firm Kyndryl, which serves the national digital identification system collecting citizens’ data related to taxes, healthcare, and pensions. This incident marked the first time since the establishment of the Dutch Investment Control Office in 2020 that a U.S. acquisition was halted.
Another potential target for American buyers is the Polish company Advanced Protection Systems (APS), which specializes in anti-drone systems. As reported by the FT, APS is considering a strategic sale while playing a crucial role in Poland’s plans to create the largest anti-drone shield in Europe following airspace violations by Russia against NATO member states. APS has recently been added to Poland’s list of strategic enterprises, granting the government the authority to block any sales transaction.
When asked about a possible sale, CEO Maciej Klemm responded to the FT that the company is “only analyzing various options for further development” and aims to become a leading European firm in anti-drone systems. European government bodies are increasingly scrutinizing mergers and acquisitions to strengthen their positions in strategic sectors such as defense, technology, and energy, while simultaneously striving for independence from the U.S., which leads to resistance against the sale of companies critical to the defense sector.
Diana Dimitrova, head of the aviation and defense sector at BCG in the UK, articulated the growing clarity of European governments’ guidelines: “Produce here, keep it here.” She emphasized that this issue extends beyond defense, encompassing jobs, supply chains, and who controls the European industrial base. Several defense technology startups considering a sale have informed advisors they will only engage with European entities to mitigate the risk of losing vital government contracts, according to one transaction advisor.
