The German giant Rheinmetall strengthens its naval presence: late on Sunday evening it announced thepurchase of naval division of the Lürssen Group, NVL.
The two companies have agreed not to disclose the purchase price of NVL. However, Jefferies analysts, noting that NVL generates double-digit margins, suggest an acquisition price of between between 1,5 billion and 2 billion euros, excluding debt. The two companies aim to complete the transaction atstart of next year, subject to approval by antitrust authorities.
Il Rheinmetall title rose 2,01% to 1.936 euros by mid-morning, leading the Frankfurt DAX index. Over the past five days, the stock has gained 5%, and since the beginning of the year, its gain has been 8,15%.
The Düsseldorf-based company, which produces tanks, grenades, and infantry fighting vehicles, has also been active in the maritime sector for decades, but this new acquisition, prompted by new geopolitical tensions, marks an important step in this sector, analysts say.
"The current conflict situation shows that military intervention capabilities in the naval sector are also becoming increasingly important," Rheinmetall said, echoing Lürssen's statement. The acquisition will transform Rheinmetall into a naval systems supplier, Adding shipbuilding to its core land and air defense businesses, the company said in a press release. Rheinmetall expects synergies with its vehicle systems business in northern Germany and plans to utilize NVL's infrastructure and expertise to expand production capacity.
Rheinmetall's move comes as consolidation in Germany's naval sector accelerates: the submarine and frigate maker Tkms it will in fact be separated from the parent company Thyssenkrupp next month.
Like other players in the industry, Rheinmetall has benefited from increased defense spending, following European countries' investments in strengthening their military capabilities. Germany alone, according to Rheinmetall, plans to spend approximately €31 billion on naval vessels by 2035.
Nvl: 2.100 employees and 1.000 ships built worldwide
NVL, which employs approximately 2.100 people globally, is a privately held group that operates four shipyards in northern Germany, including Blohm+Voss in Hamburg and Peene-Werft in Wolgast. The group, formerly known as Lürssen Defence, has built approximately 1.000 vessels for over 50 navies and coast guards worldwide.
In 2024, it posted revenues of around €1 billion and, according to company presentations, is expected to achieve an operating margin of 10% in 2025, surpassing competitors such as TKMS, Fincantieri, and Naval Group, according to Rheinmetall.
