Marine division: Rheinmetall shares at record high after takeover announcement

Rheinmetall is creating a positive mood on the stock market at the start of the week: The defense company is boosting Germany's leading index, the DAX, with an acquisition. Rheinmetall shares themselves rose by as much as 2.8 percent shortly after the start of trading, temporarily reaching €1,949—a record high. The share price jump over the past three and a half years is unprecedented: While it was still trading at just over €90 on February 4, 2022, it is now trading for around €1,940—an increase of 2,050 percent.

Germany's largest defense company plans to acquire the naval division of the Bremen-based Lürssen shipyard group. Rheinmetall announced in Düsseldorf that it has agreed on the key terms and conditions with Lürssen and will formally close the transaction shortly. If the antitrust authorities approve, the acquisition of Naval Vessels Lürssen (NVL) could be completed in early 2026. The purchase price was not disclosed. However, given the billions in revenues of both companies, a substantial sum is likely to flow to the Lürssen owners.

The Düsseldorf-based company doesn't currently manufacture ships, but primarily produces military equipment for the ground forces, such as tanks, artillery, and air defense systems. As a supplier, the company is also involved in the production of the US F35 fighter jet. The weapons manufacturer also manufactures drones and, soon, military satellites. Now, the defense company, which is on a steep growth trajectory in light of the Ukraine war and is racing from one record to the next in terms of sales and order backlog, is, so to speak, setting sail.

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The Navy already uses naval guns and laser modules from Rheinmetall, and in the future, ships will also be used – assuming the deal goes through as expected. "In the future, we will be a relevant player on land, at sea, in the air, and in space," said Rheinmetall CEO Armin Papperger. "Rheinmetall is thus developing into a cross-domain systems provider."

In addition, the consolidation of the German defense industry is being driven forward. "In conjunction with Rheinmetall's expertise, we are creating a vital German powerhouse for state-of-the-art surface vessels," Papperger said. Military assertiveness is also becoming increasingly important in the maritime sector.

According to the company, NVL has approximately 2,100 employees, and in 2024, sales amounted to approximately €1 billion. In addition to its headquarters in Bremen, there are shipyards in Wilhelmshaven (Lower Saxony), Hamburg, and Wolgast (Mecklenburg-Western Pomerania). There are also locations in Bulgaria, Croatia, Egypt, and Brunei. NVL builds ships for the German Navy and the navies of other countries, as well as for government agencies. Rheinmetall claims to have approximately 40,000 employees at 174 locations. In 2024, sales amounted to €9.8 billion.

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Lürssen will retain a yacht-building company. This company employs approximately 2,000 people. The head of the holding company, Friedrich Lürssen, said: "We are pleased to have found a trustworthy and strong partner in Rheinmetall, one that can secure a successful future for NVL and its employees." The aim is to pave the way for the long-desired consolidation in the German defense industry. This consolidation is necessary and sensible given the heightened threat situation. "This is the only way to ensure our country's rapid defense capability."

dpa/rtr/ess