Germany refuses to have less influence than France within the tank manufacturer: Berlin will spend 6.6 billion euros to acquire 50% of KNDS

The German government will pay 6.6 billion euros to acquire a stake in the Franco-German defense group KNDS, two sources familiar with the matter said on Tuesday. Berlin last week reached a deal with the family that owns KNDS to acquire a 50 percent stake in the maker of the Leopard 2 tanks, a government document said, in a bid to exert greater influence over strategic defense technologies. A price of 6.6 billion euros for a 50% stake is significantly lower than what the government had initially envisaged for a planned 40% stake.

Up to 7.2 billion euros had been allocated to this transaction initially proposed in June. It was the magazine “Der Spiegel” which was the first to reveal the purchase price. Citing parliamentary sources, he indicated that this price was based on a valuation of KNDS at 11.2 billion euros before the group's IPO, which was ultimately suspended, to which was added a bonus of one billion euros.

“An important decision at a time when the security situation in Europe is evolving” The German government declined to comment on confidential details of the ongoing negotiations, saying only that the planned investment constituted “an important decision at a time when the security situation in Europe is evolving significantly.” The shareholder families did not wish to speak. According to a Finance Ministry document prepared for parliament's budget committee, Germany aims to match France's influence within KNDS and avoid being outvoted in key decisions.

Germany would initially acquire the families' stake, with Berlin and Paris planning to reduce their stakes to 40% each in a future IPO if market conditions permit.

Machine-translated from French