The Bundeskartellamt has today cleared the creation of a joint venture between Rheinmetall AG, Düsseldorf (Germany), and Leonardo S.p.A., Rome (Italy). The joint venture, Leonardo Rheinmetall Military Vehicles (LRMV), is to be headquartered in Rome. Rheinmetall is a globally active technology group operating in the defence industry and the automotive components market. Leonardo is an Italian enterprise specialising in defence, aerospace and information security and one of the largest defence companies in the world.

If awarded the contract by the Italian Ministry of Defence, LRMV will act as prime contractor and systems integrator for the expected upcoming orders for military armoured vehicles, in particular main battle tanks and infantry fighting vehicles. According to the requirements of the Italian Ministry of Defence, at least 60 per cent of the value-adding work is to be carried out in Italy. While Leonardo is mainly to contribute its defence electronics, Rheinmetall, which already has subsidiaries in Italy, is mainly to contribute its existing platforms for the Panther main battle tank and the Lynx infantry fighting vehicle.

Andreas Mundt, President of the Bundeskartellamt: “Given the current geopolitical situation, there is considerable movement in the defence industry. Rheinmetall and Leonardo are undoubtedly two major defence companies. Nevertheless, the creation of the joint venture did not raise any competition concerns and could be cleared quickly. The activities of Rheinmetall and Leonardo are complementary; there are no significant overlaps in their current business activities.”

The fact that neither company would have been able to fulfil the expected orders from the Italian Ministry of Defence on its own also played a role in the project’s competitive assessment. Leonardo does not have the necessary platforms for the production of main battle tanks and Rheinmetall would not have been able to meet the requirement to carry out 60 per cent of the value-adding work in Italy.