John Cockerill says it is targeting an annual turnover of €1 billion ($1.1 billion) with this acquisition.
Breaking Defense https://breakingdefense.com/2024/01/belgiums-john-cockerill-to-acquire-french-land-vehicles-maker-arquus/
An Arquus and PT Pindad VAB MK3 Armored Personnel Carrier (ANOA 3) on display at Indodefense (Arquus Defense on X)
PARIS — Arquus, one of two major military vehicles manufacturers in France, will be acquired by Belgian technology company John Cockerill Group from current owner Volvo Group for about €300 million ($327 million), after mandatory consultations with staff representative bodies and other regulatory approvals.
According to a Monday statement issued by Volvo these consultations are expected to be finalized by the end of March.
John Cockerill is a major supplier of light tank turrets, firing and simulation systems. CEO François Michel said in the company statement that “the expected acquisition of Arquus by John Cockerill is a transformative step for the European defense sector in the field of light tanks. The combined offer of light tank turrets and vehicles from John Cockerill Defense and Arquus will generate important synergies that will result in more innovative and more competitive vehicles to equip land forces around the world, starting in Belgium, France, and other partner countries.”
The statement also noted that not only does this prospective acquisition contribute “to strengthening cooperation between France and Belgium in a strategic sector” but also “aims to strengthen the Group’s footprint in the worldwide land defense market and broaden its portfolio of solutions to include an extensive range of advanced, high mobility wheeled military vehicles.”
John Cockerill says it is targeting an annual turnover of €1 billion ($1.1 billion) with this acquisition. The company said the group’s defense unit will employ some 2,000 people and have major operation bases in Belgium, France, Italy, India and Saudi Arabia.
This is the second time Volvo Group has tried to divest its only defense unit which, in 2022, “represented approximately 1 percent of Volvo Group revenues” the group stated. The first attempt in 2017 failed as there were no potential buyers. Volvo Group bought what was then Renault Trucks Defense in 2001.
John Cockerill Group has been owned since 2002 by French businessman Bernard Serin, who is its chairman. It develops large-scale technological solutions in the energy, defense, industry, environment, transport and infrastructure sectors. With over 6,000 employees spread over 24 countries on five continents, its revenues in 2022 amounted to €1.046 billion ($1.14 billion), the company said.
In comparison Arquus, with 1,260 employees, reported revenues in 2022 of €550 million ($599 million), down 7 percent on 2021 in a difficult export market — where it is facing severe competition from South Korean and Turkish manufacturers — and despite the company’s major role in the French Army’s Scorpion program, together with Nexter and Thales, to produce the next generation of wheeled armored vehicles Griffon, Jaguar and Serval.
Arquus was responsible for developing and is producing everything to do with mobility (engine, transmission, suspension, steering, brakes etc.), electricity generating systems, testing and gun turrets for these vehicles. Arquus is also responsible for managing all the spare parts from the three companies in the temporary joint venture set up to manage Scorpion and ensuring that the army has them in time and in hand. Arquus also makes the truck that carries the Nexter-produced Caesar 155mm artillery system.
From a geopolitical perspective, the acquisition is a logical step in the fractured European land armaments sector.
France and Belgium signed a defense partnership agreement known as CaMo (capacité motorisée or motorized capability) aimed at ensuring the two countries armies have the same equipment and similar doctrines. As part of this agreement, Belgium is acquiring 382 Griffons, 60 Jaguars and 28 Caesar truck-mounted artillery systems.
Last month, Arquus and KNDS France (formerly known as Nexter) together with John Cockerill, were contracted to start a €15 million ($16.3 million) development program for a light, multi-role armored vehicle program known as VBAE (véhicle blindé d’aide à l’engagement) to complement the other CaMo vehicles. Some 2,000 VBAEs will be built, of which France will buy 1,440 and Belgium the others.
In addition John Cockerill Defense already has production sites in Distroff and Guénange and its Campus Cockerill in Commercy, all in north East France.
Volvo said it would book a fourth quarter 2023 operating loss from the deal of some 900 million Swedish crowns ($87.44 million).
