OHB SE: A Strategic Partnership for a Multi-Billion Euro Defense Contract

OHB and Rheinmetall discuss a consortium to bid for Germany's €10 billion SATCOMBw Stage 4 satellite network, facing competition from Airbus. OHB reports strong 2025 growth.

The German aerospace and technology group OHB SE is positioning itself for one of the nation's most significant defense procurements. In a move that could reshape the competitive landscape, the company has formally entered into partnership discussions with defense contractor Rheinmetall to jointly bid for the SATCOMBw Stage 4 project—a satellite communications network for the Bundeswehr with an estimated value reaching up to €10 billion.

A Formidable Alliance Takes Shape

On January 26, OHB confirmed the ongoing cooperative talks, which had previously been reported by media sources citing informed individuals. The stated objective is to establish a consortium capable of participating in upcoming public tender procedures. This confirmation solidifies the partners' intent to seriously evaluate a team approach in the competition for the lucrative satellite program.

The SATCOMBw Stage 4 initiative aims to deploy a sovereign, satellite-based network for the global interconnection of German military units. The architecture calls for a constellation of 100 to 200 satellites in Low Earth Orbit (LEO). This design, mirroring modern commercial mega-constellations, leverages the proximity of LEO satellites—orbiting at a few hundred kilometers—to provide significantly lower latency compared to traditional geostationary satellites stationed approximately 36,000 kilometers above Earth.

Facing Competition and Defining Roles

The pursuit of this contract is not without significant rivalry. Airbus Defence and Space has also acknowledged holding discussions with the German Ministry of Defence, setting the stage for a head-to-head competition between two major European industrial teams.

Within the potential OHB-Rheinmetall consortium, the division of labor appears clearly defined. Rheinmetall would act as the prime systems integrator, contributing its expertise in military integration, procurement logic, and operational deployment. OHB would bring its core competencies in space engineering, satellite design, and manufacturing prowess to the partnership.

Strong Operational Momentum and Expanded Ambitions

Separate from the major defense prospect, OHB is reporting robust momentum in its core business. For the 2025 fiscal year, the company recorded a 24% increase in order intake to approximately €2.1 billion. Its firm order backlog surged by 47% to over €3.1 billion. Operational performance for the first nine months of 2025 showed total output of €863.5 million, a 21% year-on-year increase, while EBIT rose 32% to €46.0 million. The company cites rising budgets from the European Space Agency (ESA), the EU, and national clients as key drivers, with the defense market notably gaining importance.

To prepare for future volume production, including the potential demands of a project like SATCOMBw, OHB expanded its manufacturing footprint in October 2025 by acquiring a facility in Schöneck, Saxony.

During its 2026 Capital Markets Day, OHB also raised its medium-term growth outlook. The company now targets total output of €1.4 billion for 2026, €1.7 billion for 2027, and over €2.0 billion for 2028. Margin expansion is projected in parallel, with the EBITDA margin expected to rise from 11% in 2026 to over 12% by 2028, and the EBIT margin climbing from 8% to over 9%.

Navigating a Shifting Competitive Landscape

OHB acknowledges increasing competitive pressures, specifically pointing to the announced merger of the space divisions of Airbus, Thales, and Leonardo, which will create a larger European rival. In response, the company is diversifying its strategic initiatives. It recently established the European Moonport Company, an entity designed to consolidate future lunar activities and develop infrastructure for commercial moon exploration.

The immediate calendar for investors is marked by the upcoming release of OHB's audited annual financial statements for 2025 on March 19. This report will provide a detailed look at how profitability has evolved relative to the company's growth. Following this, the anticipated timeline for the official SATCOMBw tender is likely to become the primary focus for market observers and a key catalyst for the stock.