KNDS postpones landmark IPO after failing to meet valuation target

KNDS delayed its IPO after the Wegmann family refused to proceed below €12.5 billion and investor demand fell short amid a European defense selloff.reuters+1
The listing had been expected in early July after France and Germany agreed in June to become equal 40% shareholders in the Leopard 2 maker.reuters+1
Earlier valuations ranged up to €25 billion, but comparable declines across the sector eroded appetite; KNDS says it will revisit timing when markets stabilize.cnbc+1

Franco-German defense group KNDS, the maker of Leopard 2 tanks and Caesar howitzers, has postponed its planned initial public offering after struggling to secure investor backing at its desired valuation, capping weeks of mounting uncertainty over what was set to be one of Europe's largest market debuts in recent years.

The company and its shareholders — including French state holding company GIAT Industries and the German Wegmann family — said they would monitor capital markets and resume the IPO process once conditions improve. The dual listing in Paris and Frankfurt had been expected in the first half of July.

Valuation Gap Proved Insurmountable

The postponement follows reporting by the Financial Times on June 30 that KNDS was struggling to convince investors to back the listing at a valuation above €12 billion. The Wegmann family had made clear it would not proceed below €12.5 billion, according to Reuters . That floor proved difficult to meet amid a broader selloff in European defense stocks that has depressed comparable valuations.reuters+1

Earlier estimates had placed KNDS's worth as high as €20-25 billion, but by the time the company formally announced its intention to float on June 24, expectations had already fallen to the €15 billion range. In the days that followed, investor appetite weakened further as volatility in the sector persisted.cnbc+3

A Long Road to Listing

KNDS had spent months clearing political and corporate hurdles to reach the IPO stage. France and Germany announced on June 22 that they had agreed to become equal 40% shareholders in the company, with Berlin purchasing its stake from the Wegmann family. That deal removed the last major obstacle to the listing, which had been complicated by months of Franco-German wrangling over governance and voting rights.bloomberg+3

The company reported strong 2025 results in May, with revenue of €4.4 billion and an order backlog of €33.1 billion, figures meant to bolster investor confidence ahead of the offering.reuters

Defense IPO Window Narrows

The delay is a setback for European defense capital markets, which had been one of the few bright spots in an otherwise slow year for IPOs on the continent. Bloomberg reported in May that KNDS's IPO plans were already wobbling over valuation concerns as peers including Rheinmetall saw sharp share price declines. The Stoxx Europe Aerospace and Defense Index has retreated from its earlier highs, weighing on appetite for new defense listings.bloomberg

KNDS said it remains committed to going public and will revisit timing when market conditions stabilize.

Sources (67)