KNDS’s Sixfold Boxer Push and 100km Howitzer Aim for €5bn IPO — But Franco-German Tussle Caps the Valuation

Defence contractor KNDS races to scale Boxer output and unveils long-range LORAS howitzer, but a shareholder clash between Berlin and Paris slashes IPO valuation to €18bn–€20bn.

The defence contractor KNDS is racing to scale up production and showcase cutting-edge artillery just as it gears up for a Frankfurt listing that could raise €5bn. But a bitter governance dispute between its two sovereign shareholders has already clipped the expected price tag, leaving fund managers to judge whether a company under dual state control deserves a premium or a discount.

Production surge targets sixfold Boxer output by 2030

KNDS Deutschland chief Florian Hohenwarter has laid out plans for two additional production sites in Germany. One will cover the entire manufacturing chain for the Boxer 8×8 armoured vehicle — from raw materials to finished hulls. The goal: to churn out six times as many Boxer systems by 2030 as the company does today. In Munich-Allach, a new series production line is already running, aiming for ten drive modules a month. Bavarian premier Markus Söder attended the opening.

The ramp-up is driven by a record backlog that reached €33.1bn at the end of the latest fiscal year, up from €23.5bn a year earlier. New orders worth €13.5bn were booked in 2025 alone, among them more than 300 Leopard 2A8 tanks for the Czech Republic, the Netherlands and Croatia, plus additional Caesar howitzers. Revenue climbed nearly 16% to €4.4bn, and operating profit hit €661m, lifting the margin to 15%.

The howitzer that outruns the competition

On the floor of the Eurosatory show in Paris, KNDS is displaying the LORAS technology demonstrator — a long-range artillery system that fires standard shells more than 60 kilometres and specialist munitions out to 100 kilometres, far outstripping current NATO guns. Mounted on a Boxer chassis, it fires more than eight rounds per minute fully automatically while still using standard NATO ammunition. The company says initial tests were successful and series production is targeted for 2032.

The system plugs a gap left by the US Army, which scrapped its own long-range artillery programme in 2024 because of severe barrel erosion. KNDS solved that problem with a larger combustion chamber that creates a gentler pressure curve inside the barrel. Now the company, together with Leonardo DRS, is bidding to supply 500 such systems to the Pentagon. A decision on prototypes is expected in July 2026. Rivals include Rheinmetall, Hanwha and Elbit.

IPO roadshow starts after Eurosatory, but price is already squeezed

The show ends on 19 June, after which KNDS will launch its roadshow for institutional investors. The four banks handling the flotation — Bank of America, Deutsche Bank, Goldman Sachs and Société Générale — have narrowed the valuation range to €18bn–€20bn, down from initial ambitions of as much as €25bn.

The downward revision stems directly from the stand-off between Berlin and Paris. Germany insists on sweeping veto rights over strategic decisions and wants to buy roughly 40% of the equity before the IPO, mirroring the French position. After listing, the two governments intend to hold about 80% of the shares collectively, then reduce their stakes to 30% each over three years. That would leave a free float of around 20%.

For fund managers, the question is whether a defence champion with two powerful state owners and limited free float can trade like a normal industrial stock. The company’s books are full: a €33.1bn order backlog, a clean bill of health from an internal probe into a 2013 Qatar contract — which allowed the audited accounts and IPO prospectus to be finalised — and strong European demand. But without the likely lift from a Pentagon contract, KNDS will have to rely solely on its European backlog to justify the mooted €20bn valuation. The roadshow will provide the first real test of investor appetite, and final pricing is due by the end of July.