MUNICH, GERMANY – APRIL 22: A Leopard 2 tank stands on the grounds of the KNDS company as the new assembly line for Boxer armored fighting vehicles starts at the KNDS factory in Munich, Germany, on April 22, 2026. The German military, the Bundeswehr, plans to acquire up to 3,000 Boxer vehicles of several variants as part of a modernization and expansion program. (Photo by Leonhard Simon/Getty Images)
Leonhard Simon | Getty Images News | Getty Images
France and Germany have agreed on a framework for the German government to take a stake in defense manufacturer KNDS ahead of its multi-billion euro IPO.
KNDS is one of Europe’s largest companies producing military equipment such as armored vehicles and ammunition used in Ukraine. The company is seen as key to the continent’s rearmament drive, which has benefited defense companies such as: line metalserve, and BAE Systems.
“By establishing the Franco-German Framework, our two countries have taken a decisive step towards strengthening their common sovereignty in land defense,” the French and German governments said in a joint statement on Monday.
Reasons why Germany aims to acquire KNDS shares
The German government said in a separate statement that Germany now aims to acquire 40% of KNDS from family shareholders.
“Germany’s investment in KNDS will ensure long-term influence in a company of strategic importance for Europe’s security and defense capabilities,” the statement, translated from German, said.
Bloomberg reported on Sunday that the company could be valued at between 15 billion euros ($17.2 billion) and 18 billion euros, citing people familiar with the matter.
Will KNDS be listed?
The parties were aiming to finalize an agreement by Monday, ahead of an IPO announcement that could occur as early as Tuesday, according to Bloomberg.
KNDS did not immediately respond to a request for comment from CNBC.
The two governments said in a joint statement that the deal would bring Germany’s holdings in KNDS to the same level as France’s.
According to multiple media reports, the French government’s stake is 50%, but its ownership is expected to be reduced to 40%, which would make the two governments equal shareholders.
