Key Takeaways

• Otokar Otomotiv is set to acquire 96.77% of Romanian defense firm Automecanica, enhancing its European operations.
• The acquisition aligns with a €857 million contract to supply 1,059 Cobra II armored vehicles, with substantial local manufacturing in Romania.
• The share purchase is expected to close by April 2026, pending due diligence and regulatory approvals.

Acquisition Announcement

Otokar Otomotiv, a Turkish manufacturer of armored vehicles, has signed a memorandum of understanding to acquire a 96.77% stake in Romania’s Automecanica. This move is intended to bolster Otokar’s industrial presence in Europe and was disclosed on the Public Disclosure Platform (KAP) this week. The deal aims to close by April 2026, contingent on due diligence and necessary regulatory permissions in Romania.

Automecanica is a Romanian defense firm that possesses established production facilities and necessary licenses. This acquisition comes as Otokar has secured a significant contract worth approximately €857 million (around $1 billion) to supply 1,059 Cobra II 4×4 armored vehicles. The agreement includes a local manufacturing component, set to take place in partnership with Automecanica through a joint venture established in 2025. Of the total units, 800 will be produced in Romania.

Otokar plans to oversee the procurement process through its newly formed subsidiary, Otokar Land Systems SRL, which will manage the acquisition. An initial payment of €5 million is due upon signing the memorandum, with the remainder paid at the closing of the deal. The total enterprise valuation for the acquisition is roughly €87.8 million, equating to about €85 million for the target 96.77% stake.

The facilities and approvals held by Automecanica are crucial to supporting Otokar’s ongoing armored vehicle programs in Romania. According to the disclosure, the direct transfer of shares to Otokar is anticipated to streamline operations and strengthen local control, as opposed to executing through a joint venture for the 4×4 tactical wheeled light armored vehicle project.

This announcement follows an earlier disclosure by Otokar on January 16, concerning compensation claims from Romtehnica amounting to approximately 191.85 million Romanian lei (around $45 million). Romtehnica contends that Otokar has not met necessary interim milestones for the local production of Cobra II vehicles in Romania. Otokar has initiated legal proceedings to annul this claim but also indicated a willingness to settle the amount when due while protecting its legal rights.

The implications of this acquisition and the ongoing legal situation reflect Otokar’s strategic efforts to strengthen its foothold in the Romanian defense sector amid challenges in production and local partnerships.

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