CEO Dispute

Tank Merger Runs onto Rocky Ground

panzer2 adjusted Clemens Niesner DPA, PR,
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  • Why it matters

    Why it matters

    A last-minute personnel dispute threatens to derail the merger of two European tank and cannon makers that is supposed to compete with General Dynamics and BAE Systems.

  • Facts

    Facts

    • French state-owned Nexter and German family-owned Krauss-Maffei Wegmann agreed to merge in July.
    • KMW/Nexter would have 6,000 employees and turnover of €1.8 billion, or $2 billion.
    • KMW makes tanks with treads and Nexter specializes in wheeled armored vehicles; both make cannons.
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  • Audio

    Audio

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The biggest European defense deal in 15 years to create the continent’s largest land defense firm may fall apart.

In a surprise move, the French government Friday announced it had appointed a new chief executive, Stephane Mayer, to run state-owned tank maker Nexter. The move threatens Nexter’s proposed merger with German privately-owned peer Krauss-Maffei Wegmann, French business daily Les Echos reported.

KMW Chief Executive Frank Haun is wary of leading the merged firm with his new designated French counterpart, the paper reported, without citing sources. The German executive views Mr. Mayer, who will take over from Philippe Burtin on Tuesday, as a co-leader whom he does not know and could be a potential rival, the paper said.

Mr. Haun was originally scheduled to co-lead the firm with Mr. Burtin until the end of 2016.

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