KNDS postpones Frankfurt-Paris IPO after defence stocks slide and investors question €15bn valuation

The announcement

Franco-German defence group KNDS confirmed on Wednesday that it had shelved its initial public offering, which was set to launch this month on the Frankfurt and Paris exchanges. The company said in a statement that it would resume the process only when capital markets for European defence equities become “more favourable”. All preparatory work had been completed and extensive talks with investors had shown confidence in the group's long-term strategy, the statement added.

We will continue to monitor the capital markets conditions closely and stand ready to resume the IPO process as soon as market conditions allow.

Why investors pushed back

Bankers had initially floated a valuation of around €15 billion for KNDS, the maker of the Leopard 2 main battle tank and the Caesar howitzer. However, the Financial Times reported on Tuesday that key investors were unwilling to support any listing priced above €12 billion, forcing the company and its shareholders to reconsider the timing. The pushback coincided with a sharp sell-off in defence stocks, with rival Rheinmetall losing significant value over recent days, adding to the chill in the sector.

Political context

The postponement comes just days after the Bundestag gave the green light for the German federal government to acquire a 40 percent stake in KNDS from the founding families. According to Spiegel, the transaction could cost Berlin up to €7.2 billion, deepening the state’s direct role in the land-systems champion. The government’s entry was seen as a stabilising anchor ahead of the IPO, but the broader market turbulence has now forced a strategic pause.

A market under pressure

The cooling of investor appetite was not confined to KNDS. In January, Czech arms group CSG completed the largest-ever defence IPO, valued at €25 billion, and German warship builder TKMS listed in October 2025 at a valuation of €5.15 billion. The subsequent slide in defence shares has reset expectations, leaving KNDS as the latest casualty of a more sceptical market environment. The talks had confirmed investors' belief in KNDS' long-term strategy, but near-term turbulence proved too great to proceed.