business
France and Germany Agree to Equal 40 Percent Stakes in KNDS, With Germany Planning Later Reduction
France and Germany reached an agreement on May 20 to become equal shareholders in defense manufacturer KNDS. The deal reduces France's stake and sets conditions for Germany's entry, with an IPO possible as soon as the next day.
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France and Germany finalized an agreement on May 20 that sets the two countries up to become equal shareholders in European defense manufacturer KNDS. The announcement came from Belfast. France currently holds a 50 percent stake that is expected to be reduced to 40 percent.
Germany is seeking an identical 40 percent stake, subject to approval by its budget committee, according to a statement from government spokesperson Stefan Kornelius. Kornelius added that the German government plans to reduce the scope of its stake at a future date.
Key principles of the pact include long-term shareholder commitment, parity in governance rights, and appropriate oversight of security matters.
The Franco-German statement said the agreement paves the way for a possible IPO of KNDS in the near future, with Bloomberg reporting the multi-billion dollar launch could occur as soon as May 21. Authorities in Berlin and Paris described the governance change as a significant milestone since KNDS’s formation in 2015 through a joint venture between France’s Nexter Systems and Germany’s Krauss-Maffei Wegmann.
The company produces Leopard 2 and Leclerc main battle tanks, infantry fighting vehicles, armored personnel carriers, uncrewed ground systems, and turrets.
The Franco-German statement said the agreement aims to develop KNDS into a leading European and global defence company serving the French and German armed forces while strengthening its competitiveness in the European land systems industry.
