Sonova Holding AG, Stäfa, Switzerland, the parent company of Phonak, Unitron, and Advanced Bionics, has announced an agreement to purchase 100% of the shares of Hansaton Akustik GmbH, Hamburg, Germany, the family-owned hearing aid maker that is one of the best-known worldwide hearing aid manufacturers outside of the so-called “Big 6.” The dollar value of the transaction was not released, and the purchase is subject to regulatory approval. Sonova also announced that it would recommit to distribution through two German retailers, Vitakustik Hörgeräte GmbH and Fiebing Hörtechnik GmbH, that Sonova had purchased in 2006 and 2009.  The company also plans on moving about 100 assembly jobs from Switzerland to the UK and China.

“The strategic moves will extend our market leadership position and at the same time assure the cost competitiveness of Sonova’s Swiss based operations,” said Sonova CEO Lukas Braunschweiler in the company announcement. The company emphasized in its announcement that wholesale is and will remain a key sales channel for Sonova, including in Germany.

Sonova also announced that Group Vice President of Marketing Maarten Barmentlo is leaving the company to pursue other interests. Sonova has decided to streamline the organization, and will not be replacing him on their Management Board.

Hansaton joins the Sonova Group, retaining its own brand. Through the acquisition of Hansaton, Sonova says it further extends its broad offering of hearing care solutions and will become the new technology partner for Hansaton, which will remain an independent wholesale company with its headquarters in Hamburg—joining the Phonak and Unitron brands under the Sonova umbrella. “The addition of Hansaton reflects our commitment to further develop market access,” said Braunschweiler. “It will create significant value for Sonova and our customers, notably in Germany.”

Hansaton employs about 200 people globally, with major centers in Germany, France, and the United States, and a well-established distribution network in over 70 countries. In 2014, the company’s sales were reportedly $48 million (EUR 42 million). Hansaton, founded in 1957, develops and manufactures a wide range of hearing aids, and is perhaps best known in North America for its unique rechargeable hearing aid technology (see Jerry Yanz et al’s article in the January 2012 Hearing Review).

“Sonova is truly the best owner of and business partner for our company going forward,” said Hansaton Managing Director Uwe Fischer. “We will greatly benefit from Sonova’s leading innovation capacity which will further strengthen our brand and help fuel our growth ambition for future expansion.”

Rededication to German retail market. Germany is to become a key retail market where Sonova will build its position through the ownership of Vitakustik GmbH and Fiebing Hörtechnik GmbH—two successful high-quality retail chains. Germany is the second-largest country (after the US) for hearing aid sales, constituting about 10% of worldwide unit volume. The country has a complex and fragmented hearing care market that has recently seen radical changes in its structure and hearing aid reimbursement system (eg, a 79% increase in reimbursement in November 2013). Although the two companies when combined make up only about 2% of the German market (versus market-leading KIND Hörakustik at about 10%), the rededication of Sonova to building its retail presence represents a significant event for the German hearing aid market where manufacturer-owned retail is an even hotter topic than in the United States.

According to Sonova, Vitakustik and Fiebing Hörtechnik provide a solid basis for the expanded retail strategy of the Sonova Group. The company says that, given recent market dynamics, it has decided that a direct presence in retail is to become a fundamental part of its strategy in Germany going forward. This will allow the Group to get closer to the end-consumers while at the same time securing the highest level of audiological services.

“We are convinced that, with the expanded strategy in Germany, we will help to positively contribute to the market,” says Braunschweiler. “The professional reputation and standing of audiologists and fitters, as well as helping to maintain the highest level of audiological services, is very important to Sonova. The move will allow us to assure excellence in customer service both in retail and wholesale.”

Other changes. In line with the existing strategy to further balance and optimize its global competitiveness, Sonova says it will transfer about 100 product assembly jobs from its Stäfa headquarters while maintaining the production of strategically critical core hearing aid components in Switzerland. Its custom product functions will be transferred to its existing shared service center in the UK, with some assembly capacities being moved to the company’s manufacturing facility in China. Most of Sonova’s hearing instrument production is already based in China and Vietnam. Further measures include a 2015 salary freeze for Swiss-based management and employees, and increased efforts to further reduce its third-party sourcing costs.

“In line with our existing strategy, we are also implementing further measures to optimize our global resource allocation,” says Braunschweiler. “I am confident that this strategic move will ensure our continued strong cost competitiveness and support the long-term strength and continued profitable growth of Sonova.”

Correction: An earlier version of this news item stated that Sonova was acquiring Vitakustik GmbH and Fiebing Hörtechnik GmbH; in fact, they had purchased these companies in 2006 and 2009. HR apologizes for the error.