Tears in a land far, far away

Dieter Adam, 15 February 2024

[This story is based on an article that first appeared in the Frankfurter Allgemeine Zeitung on Feb. 8, 2024]

Helmuth Meet GmbH is a windows manufacturer in Wittlich, a small rural town in Rhineland-Palatinate, Germany. The company was founded 38 years ago by the son of a truck driver, Helmuth Meeth, and has grown into a successful business with 140 employees and having sold about 80,000 windows, worth around NZ $40m, last year.

Now, aged 66, Helmut Meet has sold the business to DO Capital Partners. “For me, there were times in the sales process when I went through truly catastrophic emotions”, says Meeth. “When I signed the Sales and Purchase Agreement, it was a moment when things were resolved, but it was also one of the worst days of my life”, he continues, “made worse by the fact that the day after I was attending a function of a colleague who successfully passed his business on to his son. That brough tears to my eyes.”

He had held hopes that he could pass the business on to the next generation, too. But his daughter, who has been working in the business for 25 years didn’t want to take on the challenge, and his son, also at the right age, is studying pop music at university and not interested, either. “I had big hopes I could pass the business on, but the kids have other plans for their lives. I can understand that.”, says Helmuth.

His story is certainly not unique. The German KfW, a government funded development bank, expects around 266,000 SMEs across all sectors to be shut down by their owners by the end of 2025, because the owners are going to retire and have no family to pass the business on to, and can’t find someone willing to buy the business. A further almost 200,000 businesses are at risk to suffer the same fate, because their owners haven’t started preparation for a handover or sale in good time.

The business itself, Helmut Meeth GmbH, is in good shape, and Helmut will stay on as CE until March and has got a contract as an advisor to the new owners for three years, plus. However, competition is stiff – not the least from Poland, from where 4m windows were sent to Germany last year – built, as Helmut notes, with generous EU subsidies and giving Polish manufacturers a share of about 28% of the total market.

No doubt that they will look after the business well to protect and grow their investment, but the fact remains that it’s fair to assume that their interest is in owning a well-performing manufacturing business, but their passion is in making money.

Helmuth Meeth has a reputation for being a manufacturer passionate about his business, the people working in it, and maintaining close relationships with his customers. No doubt he was also interested in making money.

That subtle difference in emphasis may mean little or nothing in terms of the future welfare of Helmut Meeth GMBH, or it may mean a lot. Only time will tell.