BERLIN (AP) -- German auto parts and weapons maker Rheinmetall AG and truck manufacturer MAN Nutzfahrzeuge AG said Tuesday they were teaming up to produce wheeled military vehicles.
The joint company, Rheinmetall MAN Military Vehicles GmbH, will provide "complete solutions in the market for military wheeled vehicles, covering the entire range of armored and unarmored transport, command and role-specific vehicles for the international armed forces," the two companies said.
Under the contract signed by the two companies, Rheinmetall will have a stake of 51 percent and MAN 49 percent in the new company, which will be headquartered in Munich.
The plan is subject to approval by German regulatory authorities.
"With this new company we are combining the strong MAN and Rheinmetall brands and the complementary technological core competencies of the two partners to form a globally operating system provider, which will present one face to the military customer with the goal of improving its position in the world market," MAN chief executive Georg Pachta-Reyhofen in a statement.
In the first phase, the two companies will merge their respective development and sales activities in the military wheeled vehicle sector. Under the second phase, the two companies said they integrate their production capacities at plants in Kassel and Vienna into the joint company by the end of 2011.
It is envisioned that the new company will initially have 370 employees, but will grow to some 1,300 with an annual turnover of more than euro1 billion by the time the second phase is complete, the companies said.