World
German firm sees US getting lion’s share of $109 bln military fund
Up to half of the $109 billion (€100 billion) special fund set up to modernize the German military will likely go to US defense companies, a leading tank gear box maker said, accusing Berlin of lacking a strategy for its defense industry.
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“I don’t believe that much of the money will be left over for the German industry,” Susanne Wiegand, chief executive of Renk Group, told reporters in Munich, adding the government in Berlin did not realize the strategic importance of the defense industry.
“Germany does not have a strategic compass for the defense industry. This is something the French are handling much better,” she said late on Monday at a journalist briefing embargoed for Tuesday.
Wiegand called on the government to use the $109 billion (€100 billion) fund not only to plug short-term gaps in the German military’s inventories but also to help develop technologies of the future.
The chancellery in Berlin did not immediately respond to a Reuters e-mailed request for comment.
Renk, formerly a subsidiary of Volkswagen, is global leader in the production of gear boxes for tanks including the Leopard 2.
The company, situated in the Bavarian town of Augsburg, makes about 70 percent of its sales from gear boxes for tanks and navy ships, the rest with gear boxes for civilian purposes such as compressors.
Three years after VW sold Renk to financial investor Triton for $762 billion (€700 million), the company is preparing for a stock market flotation.
“I see the capital market as a next step in our development but nothing has been decided yet,” Wiegand said, without giving a date for a potential listing.
Renk has booked orders totaling of $4.3 billion (€3.9 billion), including framework contracts, according to the CEO.
Bankers estimate Renk;s value to be around $2.72 billion (€2.5 billion) in case of an IPO.
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