A wealthy German family that owns half of the major European tank company KNDS is planning to sell part of its stake. KNDS was created when Germany’s Krauss-Maffei Wegmann merged with France’s Nexter in 2015, and it has since become a key player in Europe’s land defense industry. The German family, which includes the Bode and Braunbehrens families, currently owns 50 per cent of KNDS, while the other 50 per cent is held by the French government.
According to a Bloomberg report, the family is exploring ways to reduce its ownership. They’re considering either selling part of their stake to private investors or taking the company public through a stock market listing, known as an IPO. They have already informed the German government of their plans, and Berlin is now thinking about buying a 25.1 per cent minority stake that would give it the power to block major decisions.
There is growing interest from outside investors in the defense sector, which makes this a good time for the family to make a move. Several large investment firms such as Advent, KKR, Warburg Pincus, and CVC Capital, as well as wealthy funds from the Middle East and German financial institutions, have already begun early discussions about possibly buying in.
Right now, the most preferred route for the family seems to be the IPO, which could happen as soon as next year. If the company is listed publicly, it might be valued at more than €20 billion. In that case, both the German family and the French government might each sell a little more than 10 per cent of their stakes.
At the same time, the family is still open to offers from financial investors or other defense companies like Rheinmetall. However, any new investor would need approval from the German government. If none of these options work out, the family may even consider breaking up KNDS by reversing the original 2015 merger. This would allow them to exit the business more easily. Although this breakup plan is not the first choice, some German lawmakers and labor unions might actually support it, seeing it as a way to protect national interests.
What complicates the matter is the ownership structure. Both the German and French sides have the power to block any big changes, and within the German family itself, not everyone agrees on what to do next. So while the goal is to sell or reduce the family’s share, actually making it happen may be a long and delicate process.