KNDS is set to debut on the Frankfurt and Paris exchanges on July 13, days before France’s Bastille Day, but the €15bn float is a pure cash-out for existing owners — not a single euro will flow into the company itself. Up to 20% of existing shares are changing hands, with the entire proceeds going to the longstanding shareholders: Germany’s Wegmann family and the French state holding GIAT Industries.
The ownership shuffle is tightly choreographed. The German government, via KfW, is buying the Wegmanns’ entire 40% stake for as much as €7.2bn, ending a 144-year family dynasty. France, which currently holds 50%, is trimming its position by ten percentage points. After the IPO, both states will each own 40% of the ordinary shares, with the remaining 20% floating to institutional investors. The structure is designed to strike a power balance between Berlin and Paris.
That balance comes with heavy safeguards. Each government holds a mutual veto preventing the other from reducing its stake below 30% for the next ten years. Golden shares shield strategic assets from unwanted foreign interference. The supervisory board will be split evenly: three seats each for KfW and France, plus the chief executive and independent directors. To further stabilise the register, shareholders who hold their stock for two years earn double voting rights.
The order book is stuffed — €33.1bn at the end of fiscal 2025, roughly 7.5 times last year’s revenue. Revenue hit €4.4bn last year, up 16%, with EBIT of €661m translating into a 15% margin. Free cash flow reached €980m. But the outlook for 2026 shows a squeeze: revenue is expected to climb about 30%, yet the EBIT margin is forecast to slip to around 12%. The reason is a costly ramp-up of artillery production, including €750m in capital expenditure for new factories, alongside the expiry of high-margin legacy contracts. Management’s medium-term target is annual revenue of €11bn to €12bn. To lure income-focused investors, KNDS has pledged a dividend from 2027, paying out roughly 40% of net profit from the 2026 financial year.
Should investors sell immediately? Or is it worth buying KNDS?
At Eurosatory in June, KNDS unveiled two new platforms to bolster its lineup. The CAPINT main battle tank mates an upgraded Leopard 2A8 chassis with an unmanned ASCALON turret, intended to bridge the gap until the next-generation MGCS enters service in the 2030s. The LORAS artillery system packs a 155mm gun onto a Boxer tracked vehicle, with a range exceeding 60km — and up to 100km with specialised rounds. A more immediate catalyst looms this month: the US Army is set to decide on a contract for up to 500 howitzers, with KNDS bidding alongside Leonardo DRS against Hanwha and Rheinmetall.
The broader defence sector has turned wobbly. Investors are questioning whether European governments will actually follow through on promised budget increases. Rheinmetall, KNDS’s closest listed peer, has lost about a quarter of its market value this year, including a single-day drop of 18%. Against that backdrop, the state-heavy governance of the KNDS float may give some institutional buyers pause.
Bank of America, Deutsche Bank, Goldman Sachs and Société Générale are managing the offering. The final price will be set once the order books close. Whether the dual listing can command a premium in a sector already under pressure — and with a decade of political lock-up baked into the equity — will become clear on July 13.
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