Franco-German tank maker KNDS aims to float as Europe's defense rally stalls. The Stoxx aerospace and defense index has dropped a fifth from January highs, with major beneficiary Rheinmetall missing Q1 estimates. This cooling market complicates KNDS's summer IPO plans.

Ownership hurdles add pressure. Equal stakes held by French state and German families create complexity. Berlin seeks to buy family shares for security, but price and politics stall talks. A Czech bid faces political and market resistance.

A proposed €20bn valuation appears stretched. Even matching Rheinmetall's growth would yield only €800mn operating profit, demanding a 25x multiple versus Rheinmetall's 20x. Investors now favor agile tech like drones over traditional tanks, leaving KNDS's moment in the market behind.