Poland’s train manufacturer Pesa Bydgoszcz SA agreed to buy German competitor HeiterBlick GmbH, adding to a string of Polish takeovers in Europe’s biggest economy as local companies seek to capitalize on their neighbor’s slowdown.

Pesa will purchase 100% of the troubled tram maker for an undisclosed sum to strengthen its foothold in western Europe, according to Piotr Matczuk, head of state development fund PFR SA, which owns Pesa.

The deal underscores a shifting dynamic between the neighbors. PFR, whose key mandate is to support Polish firms in their foreign expansion, sees a growing appetite among local firms to pursue investments in Germany, where succession issues and a sluggish economy are presenting acquisition possibilities.

“The current economic slowdown in Germany, along with growing succession challenges, may create attractive opportunities, especially since a number of Polish firms have already built up sufficient capital,” Matczuk told Bloomberg News. 

PFR expects at least two more German M&A transactions in the next six months.

For Pesa, the acquisition comes after the completion of a 6.8 billion-zloty ($1.9 billion) debt refinancing, the capstone of a restructuring effort that began when the state fund took control of the then-ailing manufacturer in 2018. It also follows its unsuccessful bid for Spanish train maker Talgo SA last year.

The transaction adds to a series of Polish forays into the German market backed by PFR. In past months, the state fund supported candle maker Trend Glass’s acquisition of Germany’s Gala Group GmbH and provided financing to tire recycling company Grupa Recykl SA for its takeover of HRV GmbH.