KNDS Carries ÂŁ1bn UK Howitzer Contract and Cut IPO Valuation Into Eurosatory Spotlight
14.06.2026 - 13:24:33 | boerse-global.de
The pan-European defence group KNDS strode into the Eurosatory exhibition in Paris this week with a freshly signed £1bn contract for 72 remote-controlled howitzers, but the fanfare was tempered by a sharp reduction in the valuation its bankers are now putting on the planned dual listing in Frankfurt and Paris. After months of speculation that the group could be worth up to €25bn, the four lead banks — Bank of America, Deutsche Bank, Goldman Sachs and Société Générale — have narrowed the range to between €18bn and €20bn.
The downgrade reflects a bitter governance standoff between Berlin and Paris that has dampened investor enthusiasm. The German government is demanding extensive veto rights over strategic decisions and wants to acquire a stake of roughly 40% before the flotation, mirroring the position France is negotiating. Even after the IPO, the two states would together control around 80% of the equity and plan to reduce their holdings to 30% each only over the following three years, leaving a free float of just 20%. That structure — a company still under dual state control — is precisely what fund managers are balking at.
The listing timetable, originally set for June or July, is now described as “extremely ambitious” in Berlin government circles. However, one major obstacle has been cleared: an internal investigation into a 2013 contract with Qatar for howitzers and Leopard 2 tanks concluded that no evidence of criminal conduct by employees was found, allowing KNDS to finalise its audited 2025 accounts and release the official IPO prospectus. The company aims to raise roughly €5bn from the flotation, equivalent to a quarter of its equity.
Should investors sell immediately? Or is it worth buying KNDS?
The British order, placed by OCCAR on behalf of the UK military, provides a powerful entry narrative. The RCH 155 howitzers will be mounted on Boxer wheeled armoured vehicles and built through ARTEC GmbH, a joint venture with Rheinmetall. Capable of firing eight rounds a minute at targets up to 70 kilometres away, the first units are scheduled for delivery in 2028. KNDS UK will manufacture key Boxer components — chassis, engines and transmissions — at its Stockport facility, securing around 500 jobs in the British defence industry.
Operationally, the company is in formidable shape. Revenue for 2025 rose 16% to €4.4bn, while the order backlog swelled to €33.1bn from €23.5bn at the end of 2024 — more than seven times annual sales. Operating profit climbed to €661m, lifting the margin to 15%. Growth was broad-based: German land-vehicle sales advanced 17.4%, French operations 9.6%, and the munitions division surged 24.7% to €612m. An additional €262m came from the sale of the Renk stake in May.
The wild card remains the US Army. A prototype contract is expected by July, with the potential to lead to production of as many as 500 systems by 2028. KNDS is bidding jointly with American partner Leonardo DRS, but faces stiff competition from Rheinmetall, Hanwha and Elbit. If the Pentagon decision drops inside the IPO subscription window, demand could spike; without it, KNDS will have to defend its €18bn–20bn price tag on operational numbers alone.
Eurosatory runs until 19 June. After the exhibition doors close, the roadshow with fund managers begins — and there the fate of the summer listing will be decided. A delay to September is increasingly seen as the fallback if the political and valuation hurdles cannot be bridged in the coming weeks.
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KNDS Stock: New Analysis - 14 June
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