Frankfurt (Germany) (AFP) – Germany’s Rheinmetall has struck a deal to take over a warship builder, both companies said, marking the defence giant’s latest expansion to meet booming demand as European countries rush to rearm. The group has agreed to acquire Naval Vessels Luerssen (NVL), the military division of ship makers Luerssen Group, based in the northern German port city of Bremen. This acquisition signifies a major expansion into naval defence for Rheinmetall, which is already a key supplier of equipment—from armoured vehicles to ammunition, including supplies to Ukraine as it continues to fend off Russia’s three-year invasion.
European countries have been racing to build up their militaries since Russia’s 2022 invasion of Ukraine. This drive has been further fueled by US President Donald Trump’s calls for the continent to increase its own defence spending and his questioning of the transatlantic alliance. “Rheinmetall is expanding its portfolio to include naval shipbuilding,” said the Duesseldorf-based group in a statement late Sunday, pointing to the “massive increase in demand from naval forces and rising procurement budgets.”
“Against the backdrop of the heightened threat situation in particular, we consider consolidation within the defence industry to be necessary and sensible,” added Luerssen’s managing partner Friedrich Luerssen in a statement. Rheinmetall, whose shares rose 2.4 percent in Frankfurt following the announcement of the deal, indicated that the goal is for the transaction to close in early 2026, subject to regulatory approval. Neither party disclosed the price of the deal.
NVL operates four shipyards in northern Germany and has additional sites around the world. The firm, which traces its history back approximately 150 years, employs around 2,100 people globally and has built about 1,000 ships, delivering them to navies and coastguards around the world. Following the acquisition, the Luerssen Group will now focus solely on building civilian mega-yachts. Notably, Rheinmetall opened Europe’s largest munitions factory last month, with the site in northern Germany set to produce 350,000 artillery shells annually by 2027.
© 2024 AFP
