Rheinmetall, Leonardo say deal paves way for EU defence consolidation
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ROME, July 4 (Reuters) -The newly-formed joint venture between Germany's Rheinmetall RHMG.DE and Italy's Leonardo LDOF.MI is a first step in the consolidation of the European defence vehicle sector, the chief executives of the two groups said on Thursday.
Rheinmetall's Armin Papperger added that the agreement, announced on Wednesday, could capitalise on a European market worth more than 50 billion euros ($53.99 billion).
"My expectation is that, with (this) cooperation only on the vehicle side, there is a market of more than 50 bln euros, a huge market that we can conquer," Papperger said in a recorded message posted online.
"We can help Europe grow, together, and this is a very first small step on the vehicle side for consolidation on the European level," he added.
The alliance, which comes after the breakdown of talks between Leonardo and Franco-German KNDS, is in line with the two group's broader objective of creating pan-European consortia to develop new combat systems.
The two companies said on Wednesday the deal aims to produce tanks and other land defence systems.
"The target is to create a machine that is cutting edge for the future. A machine that is cross-domain and interoperable, talking, in the future, to satellites, helicopters and aircraft," Leonardo CEO Roberto Cingolani said.
($1 = 0.9261 euros)
Reporting by Giulia Segreti and Matthias Inverardi, editing by Gavin Jones
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