Germany Takes 40% of KNDS, Setting Europe's Tank Maker on Course for a Listing

Germany has agreed to take a 40 per cent stake in KNDS, the Franco-German manufacturer of the Leopard 2 battle tank, a deal that clears the last obstacle to a stock-market listing for one of Europe's most important arms makers and binds Berlin and Paris more tightly together at the heart of the continent's rearmament.

The German state will enter the company through KfW, its public development bank, paying an estimated €8 billion for a holding that mirrors the one France already controls. The founding Wegmann family, which has owned half of KNDS since its creation, is selling out in full, while Paris intends to pare back its own stake so that the two governments finish as equal shareholders.

An equal partnership, by design

In a joint statement, the two governments said they had “reached an agreement on the strategy and governance of KNDS, of which they intend to become joint shareholders through transactions aiming at equal shareholding levels for both countries.” Berlin framed the move in plainly strategic terms.

The stake “will secure long-term influence on a company that is strategically significant for European security and defense capability,” the German government said.

The symmetry is the whole point. KNDS was created in 2015 from the merger of Germany's privately held Krauss-Maffei Wegmann and France's state-owned Nexter, an attempt to forge a single European land-systems champion capable of standing beside the American defence giants. Equal ownership has been the unwritten rule of that bargain from the start; with the family owners now exiting, the only way to preserve it was for Berlin to buy in at the same level as Paris.

Getting there was not straightforward. The size of the German holding had been argued over for months, with the defence ministry pressing for a full 40 per cent — rather than a smaller blocking minority — on the grounds that only parity would protect sensitive technology, secure German jobs and give Berlin a genuine say over exports.

A champion built for Europe's war

Headquartered in Amsterdam, KNDS is among the defining industrial names of Europe's defence build-up. It reported revenue of €4.4 billion in 2025, employs more than 11,000 people and is sitting on an order backlog of roughly €33 billion. Its product list reads like an inventory of the war in Ukraine:

• the Leopard 2 and Leclerc main battle tanks;
• the PzH 2000 and CAESAR self-propelled howitzers;
• the Puma and Boxer armoured fighting vehicles.

Demand for that hardware has surged since Russia's full-scale invasion of Ukraine in 2022, as European governments scramble to refill arsenals run down by decades of underinvestment and to keep weapons flowing to Kyiv. KNDS has booked record orders, expanded production and built up a maintenance presence inside Ukraine itself.

The road to the market

The stake sale removes the final hurdle to an initial public offering. People familiar with the plans say KNDS is preparing a dual listing in Frankfurt and Paris, with an announcement possible within days, that could value the group at between €15 billion and €18 billion — and, by some estimates, close to €20 billion. Roughly a quarter of the shares would trade freely, leaving the two states firmly in control.

A successful float would rank among the largest European defence listings in years, and it arrives as defence shares enjoy a historic re-rating: investors who once shunned the sector on ethical grounds are now chasing its order books. For KNDS, public capital offers the firepower to scale up at the pace governments are demanding.

For European capitals, the calculation has shifted from cost to control. With Washington pressing the continent to shoulder more of its own defence and to spend far more on it, the question of who owns Europe's industrial base — and who can veto where its tanks are sold — has become unavoidably political. A decade ago European states were selling out of their arms makers and shrinking military budgets in the long peace that followed the Cold War. Today they are buying back in, treating control of the factories that build tanks and howitzers as a matter of sovereignty rather than a line in a privatisation ledger.