Germany is preparing to acquire a major stake in defence manufacturer KNDS, marking a significant shift in the balance of influence within one of Europe’s leading military equipment companies.
Government sources familiar with the discussions told AFP on Wednesday that Berlin plans to initially secure a 40 percent stake in the Franco-German group before gradually reducing it to 30 percent over the next two to three years.
The agreement is expected to give Germany the same governance and shareholder rights currently enjoyed by the French state, even after the stake reduction takes place.
The move reflects Berlin’s growing interest in strengthening its role within the European defence sector as regional military spending continues to rise amid geopolitical tensions and broader rearmament efforts across Europe.
KNDS is presently controlled largely by French interests through public holding company GIAT Industries, while Germany’s Wegmann family retains ownership of the remaining share. The company has also been exploring plans for an initial public offering at a time when defence stocks are attracting heightened investor attention due to increased military modernization programs across Europe.
Germany’s investment is viewed as an effort to gain greater strategic influence over a company that plays a central role in supplying advanced military equipment to both German and French armed forces.
Under the reported arrangement, France is expected to reduce its own stake as much as possible while still maintaining involvement in the group’s governance structure.
KNDS manufactures several high-profile defence systems, including the Leopard 2 main battle tank and Caesar self-propelled howitzers. The company was established in 2015 through the merger of France’s Nexter and Germany’s Krauss-Maffei Wegmann, creating one of Europe’s most influential defence industry partnerships focused on land-based military technology and cross-border industrial cooperation.