BERLIN — The German government announced Monday that it plans to acquire a 40% ownership stake in defense contractor KNDS, a company whose military hardware includes Leopard and Leclerc tanks, as part of a broader effort to bolster European defense production alongside NATO partner France.
France’s government already holds a 50% share in KNDS, a company created in 2015 through the merger of Germany’s Krauss-Maffei Wegmann and France’s Nexter. The remaining ownership is held by the German family connected to Krauss-Maffei Wegmann.
KNDS, which is based in Amsterdam, reported revenues of 4.4 billion euros — roughly $5 billion — last year and employs more than 11,000 people worldwide.
European nations have been working to increase defense spending, ramp up weapons production, and grow their military forces in response to Russia’s ongoing war in Ukraine and growing uncertainty about the reliability of the United States as an ally.
In a statement, the German government said its planned investment “will secure long-term influence on a company that is strategically significant for European security and defense capability.” It added that the move will also strengthen “national industrial value creation, as well as technological sovereignty and the protection of security interests and key technologies in Germany.”
A joint statement released by both governments said France and Germany have reached an agreement on how KNDS will be managed and governed, noting that both countries “intend to become joint shareholders through transactions aiming at equal shareholding levels for both countries.”
The statement did not provide a specific timeline for when the transactions would be completed or what the final ownership percentages would be. However, it indicated the agreement could open the door for a potential initial public offering of KNDS in the near future.
Together, the two governments said their deal “reflects the shared determination of France and Germany to strengthen Europe’s industrial and defense capabilities, support their armed forces, and strengthen European sovereignty over the long term.”
In addition to tanks, KNDS manufactures Puma infantry fighting vehicles, as well as Boxer and Dingo armored personnel carriers.
